605 Third Avenue
New York, NY 10158
(212)850-6000
John Wiley & Sons, Inc Bradford Wiley II
Chairman of the Board
August 8, 1997
TO OUR SHAREHOLDERS:
We cordially invite you to attend the 1997 Annual Meeting of Shareholders
to be held Thursday, September 18, 1997 at 9:30 in the morning, at the Shelburne
Murray Hill Hotel, Grand Ballroom, 303 Lexington Avenue at 37th Street, New
York, New York. The official Notice of Meeting, Proxy Statement, and separate
forms of proxy for Class A and Class B Shareholders are enclosed with this
letter. The matters listed in the Notice of Meeting are described in the
attached Proxy Statement.
The Board of Directors welcomes and appreciates the interest of all our
shareholders in the Company's affairs, and encourages those entitled to vote at
this annual meeting to take the time to do so. We hope you will attend the
meeting, but, whether or not you expect to be personally present, please sign,
date and promptly return the enclosed proxy card (or, if you own two classes of
shares, both proxy cards)in the accompanying post-paid envelope. This will
assure that your shares are represented at the meeting. Even though you execute
this proxy, you may revoke it at any time before it is voted. If you attend the
meeting you will be able to vote in person if you wish to do so, even if you
have previously returned your proxy card.
Your vote is important to us, and we appreciate your prompt attention to
this matter.
Sincerely,
/s/ Bradford Wiley
-----------------------------
Chairman of the Board
<PAGE>
John Wiley & Sons, Inc., 605 Third Avenue, New York, NY 10158 (212)850-6000
NOTICE OF ANNUAL MEETING
of Shareholders
to be held
September 18, 1997
To our Shareholders:
The Annual Meeting of Shareholders of John Wiley & Sons, Inc. (the
"Company" will be held at the Shelburne Murray Hill Hotel, Grand Ballroom, 303
Lexington Avenue at 37th Street, New York, New York, on Thursday, September 18,
1997 at 9:30 A.M., for the following purposes:
1. To elect a board of fifteen (15)directors, of whom five (5) are to be
elected by the holders of Class A Common Stock voting as a class and ten (10)
are to be elected by the holders of Class B Common Stock voting as a class.
2. To ratify the appointment by the Board of Directors of the Company's
independent public accountants for the fiscal year ending April 30, 1998.
3. To transact such other business as may properly come before the meeting
or any adjournments thereof.
Shareholders of record at the close of business on August 1, 1997 are
entitled to notice of and to vote at the Annual Meeting or any adjournments
thereof.
BY ORDER OF THE BOARD OF DIRECTORS
JOSEPHINE A. BACCHI
Secretary
August 8, 1997
New York, New York
Your vote is important to us. Whether or not you plan to be present at the
Annual Meeting, please mark, sign, date and return promptly the accompanying
proxy (OR PROXIES IF YOU ARE A HOLDER OF BOTH CLASSES OF COMMON STOCK) in the
enclosed envelope to which no postage need be affixed if mailed in the United
States. If you attend the Annual Meeting in person, you may withdraw your proxy
or proxies and vote your shares personally.
<PAGE>
PROXY STATEMENT
This Proxy Statement is furnished in connection with the solicitation by
the Board of Directors of John Wiley & Sons, Inc. (the "Company") of proxies to
be used at the Annual Meeting of Shareholders to be held on September 18, 1997
at the time and place set forth in the accompanying Notice of Meeting and at any
and all adjournments thereof. This Proxy Statement and accompanying forms of
proxy relating to each class of Common Stock, together with the Company's Annual
Report to Shareholders for the fiscal year ended April 30, 1997 ("fiscal 1997"),
are being first sent or given to shareholders on August 8, 1997.
The executive offices of the Company are at 605 Third Avenue, New York, New
York 10158.
TABLE OF CONTENTS
[GRAPHIC OMITTED] Voting Securities, Record Date, Principal Holders, page 1
[GRAPHIC OMITTED] Certain Information Concerning the Board, page 4
[GRAPHIC OMITTED] Election of Directors, page 5
[GRAPHIC OMITTED] Executive Compensation, page 11
[GRAPHIC OMITTED] Proposal to Ratify Appointment of Independent Public
Accountants, page 17
[GRAPHIC OMITTED] Solicitation of Proxies, page 18
[GRAPHIC OMITTED] Deadline for Submission of Shareholder Proposals, page 18
I. Voting Securities -- Record Date -- Principal Holders
Only shareholders of record at the close of business on August 1, 1997 are
entitled to vote at the Annual Meeting of Shareholders on the matters that may
come before the Annual Meeting.
At the close of business on August 1, 1997, there were approximately
12,813,712 shares of Class A Common Stock, par value $1.00 per share (the "Class
A Stock"), and 3,155,285 shares of Class B Common Stock, par value $1.00 per
share (the "Class B Stock"), issued and outstanding and entitled to vote, except
for 40,538 shares of Class A Stock which are restricted shares and may not be
voted until restrictions lapse (see Summary Compensation Table on page 13). In
addition, there were 3,803,936 shares of Class A Stock and 871,024 shares of
Class B Stock held as treasury shares which are neither voted nor counted as
outstanding. There were no shares of Preferred Stock issued and outstanding at
the close of business on August 1, 1997.
The holders of Class A Stock, voting as a class, are entitled to elect five
(5) directors, and the holders of Class B Stock, voting as a class, are entitled
to elect ten (10) directors. Each outstanding share of Class A and Class B Stock
is entitled to one vote for each Class A or Class B director, respectively. The
presence in person or by proxy of a majority of the outstanding shares of Class
A or Class BStock entitled to vote for directors designated as Class Aor Class B
directors, as the case may be, will constitute a quorum for the purpose of
voting to elect that class of directors. All elections shall be determined by a
plurality of the class of shares voting thereon. Only shares that are voted in
favor of a particular nominee will be counted toward such nominee's achievement
of a plurality. Shares present at the meeting that are not voted for a
particular nominee or shares present by proxy where the shareholder properly
withheld authority to vote for such nominee (including broker non-votes) will
not be counted toward such nominee's achievement of a plurality.
1
<PAGE>
The holders of the Class A and Class B Stock vote together as a single
class on all other business that properly comes before the Annual Meeting, with
each outstanding share of Class A Stock entitled to one-tenth (1/10) of one vote
and each outstanding share of Class B Stock entitled to one vote. Abstentions
and broker non-votes are not counted in determining the votes cast in connection
with the ratification of auditors, but do have the effect of reducing the number
of affirmative votes required to achieve a majority for such matters by reducing
the total number of shares from which the majority is calculated.
The following table and footnotes set forth, at the close of business on
August 1, 1997, information concerning each person owning of record, or known to
the Company to own beneficially, or who might be deemed to own, 5% or more of
its outstanding shares of Class A or Class B Stock. The table below was prepared
from the records of the Company and from information furnished to it.
<TABLE>
<CAPTION>
- - -----------------------------------------------------------------------------------------
Class of Common Stock Percent of
Name and Address Stock Owned Beneficially Class
- - -----------------------------------------------------------------------------------------
<S> <C> <C> <C>
Peter Booth Wiley B 1,060,156 33.6%
W. Bradford Wiley,
Bradford Wiley II and
Deborah E. Wiley as Trustees
under the Will of Edward P. Hamilton
605 Third Avenue
New York, New York(1)
W. Bradford Wiley A 27,420 0.2%
and Deborah E. Wiley as B 212,840 6.7%
Trustees under the
Elizabeth W. Hamilton Trust
605 Third Avenue
New York, New York(2)
W. Bradford Wiley A 653,228 5.1%
605 Third Avenue B 412,252 13.1%
New York, New York(3)(4)(5)(6)(7)(8)(10)
Deborah E. Wiley A 127,680 1.0%
605 Third Avenue B 171,375 5.4%
New York, New York(4)(5)(8)(9)(10)
Peter Booth Wiley A 115,460 0.9%
605 Third Avenue B 98,255 3.1%
New York, New York(6)(10)
Bradford Wiley II A 109,708 0.9%
605 Third Avenue B 98,226 3.1%
New York, New York(7)(10)
The Bass Management Trust A 1,481,080 11.6%
and Certain Other Persons B 400 --
and Entities
201 Main Street
Fort Worth, Texas(11)
- - ---------------------------------------------------------------------------------------
</TABLE>
(1) These shares are not included in the listings of shares separately owned by
Peter Booth Wiley, W. Bradford Wiley, Bradford Wiley II or Deborah E.
Wiley.
(2) These shares are not included in the listings of shares separately owned by
W. Bradford Wiley or Deborah E. Wiley.
(3) Included in W. Bradford Wiley's totals are 201,280 shares of Class A Stock
and 134,188 shares of Class B Stock held by a trust for the benefit of W.
Bradford Wiley, of which Mr. Wiley and Morgan Guaranty Trust Company of New
York are co-trustees.
(4) W. Bradford Wiley and Deborah E. Wiley, as co-trustees, share voting and/or
investment power with respect to 109,380 shares of Class B Stock under the
Edward P. Hamilton Trust. For purposes of this table, each is shown as the
owner of one-half of such shares.
2
<PAGE>
<TABLE>
<CAPTION>
- - -----------------------------------------------------------------------------------------
Class of Common Stock Percent of
Name and Address Stock Owned Beneficially Class
- - -----------------------------------------------------------------------------------------
<S> <C> <C> <C>
GeoCapital Corporation A 1,272,870 9.9%
New York, NY
Investment Manager(12)
Warburg Pincus Counsellors Inc. A 1,148,550 9.0%
New York, NY
Investment Manager(12)
United States Trust Company of A 1,060,395 9.0%
New York
New York, NY
Investment Manager(12)
Pioneering Management Corporation A 873,600 7.0%
Boston, MA
Investment Manager(12)
Theodore L. Cross and Certain A 602,676 5.0%
Other Persons and Entities B 312,988 10.0%
200 West 57th Street
New York, New York(13)
- - ---------------------------------------------------------------------------------------
</TABLE>
(5) W. Bradford Wiley and Deborah E. Wiley, as co-trustees, share voting and/or
investment power with respect to 218,784 shares of Class A Stock and
145,856 shares of Class B Stock under a trust for the benefit of Bradford
Wiley II. For purposes of this table, each is shown as the owner of
one-half of such shares.
(6) W. Bradford Wiley and Peter Booth Wiley, as co-trustees, share voting
and/or investment power with respect to 218,784 shares of Class A Stock and
145,856 shares of Class B Stock under a trust for the benefit of Deborah E.
Wiley. For purposes of this table, each is shown as the owner of one-half
of such shares.
(7) W. Bradford Wiley and Bradford Wiley II, as co-trustees, share voting
and/or investment power with respect to 218,784 shares of Class A Stock and
145,856 shares of Class B Stock under a trust for the benefit of Peter
Booth Wiley. For purposes of this table, each is shown as the owner of
one-half of such shares.
(8) W. Bradford Wiley and Deborah E. Wiley, as co-trustees, share voting and/or
investment power with respect to 13,768 shares of Class A Stock and 9,180
shares of Class B Stock under the Trust of Esther B. Wiley. For purposes of
this table, each is shown as the owner of one-half of such shares.
(9) Includes 452 shares of Class A Stock which Deborah E. Wiley has the option
to purchase under an option granted under the Company's 1987 Incentive
Stock Option and Performance Stock Plan.
(10) Bradford Wiley II, Deborah E. Wiley and Peter B. Wiley, as general partners
of a limited partnership, share voting and/or investment power with respect
to 74,420 shares of Class B Stock owned by the limited partnership. For
purposes of this table, each is shown as the owner of one-third of such
shares. W. Bradford Wiley has a 99% limited partnership interest in such
partnership. As a limited partner, W. Bradford Wiley does not have voting
or investment power with respect to such shares and such shares are not
included in the listing of shares separately owned by him.
(11) On the basis of filings with the Securities and Exchange Commission
pursuant to Rule 13-D of the Securities Exchange Act of 1934, includes The
Bass Management Trust, Perry R. Bass, Nancy L. Bass, Lee M. Bass, Portfolio
I Investors, L.P., and certain other persons.
(12) Based on filings with the Securities and Exchange Commission, including
filings pursuant to Rule 13f-1 of the Securities Exchange Act of 1934, and
other information deemed reliable by the Company.
(13) Based on filings with the Securities and Exchange Commission pursuant to
Rule 13-D of the Securities Exchange Act of 1934, includes Theodore L.
Cross, Mary S. Cross, Amanda B. Cross, Lisa W. Pownall-Gray, and the
Louisville Charitable Remainder Unit Trust.
- - --------------------------------------------------------------------------------
3
<PAGE>
II. Certain Information Concerning the Board
The Board of Directors is currently composed of 15 members. Deborah E.
Wiley, Peter Booth Wiley and Bradford Wiley II are the children of W. Bradford
Wiley (see table on page 2).
The Board met six times during fiscal 1997, and Board committees met a
total of 17 times during fiscal 1997. No director attended fewer than 75% of the
aggregate number of meetings of the Board and of the committees on which such
director sat.
The Board of Directors has appointed the following standing committees:
Executive and Policy Committee. The Executive and Policy Committee currently
consists of Mr. Thomas as Chairman, Messrs. Agnew, Fernandes, Macey, Sutherland,
and Taylor. Its functions include reviewing corporate objectives and the
strategies and policies developed by senior management to attain those
objectives; assisting management in developing and refining such objectives,
strategies, and policies; monitoring the implementation of strategies and
policies; evaluating the Chief Executive Officer's performance in connection
therewith; and reporting to the Board of Directors its recommendations and
observations with respect to the foregoing. It also exercises the powers of the
Board as appropriate in cases where immediate action is required, except as
limited by law. The committee met four times during fiscal 1997.
Audit Committee. The Audit Committee, which currently consists of Mr. Agnew as
Chairman, Messrs. Baker, Fernald, and Taylor, assists the Board of Directors in
fulfilling its fiduciary responsibilities with respect to the accounting
policies, internal controls and reporting practices of the Company and its
subsidiaries, and the sufficiency of auditing relative thereto. It recommends to
the Board the firm of independent public accountants which is to be engaged to
audit the books and records of the Company; reviews with management and the
outside auditors the Company's financial statements and the auditors' report
thereon; and reviews the scope of the audit examination and fees for audit and
non-audit services. The committee met twice during fiscal 1997.
Executive Compensation and Development Committee. The Executive Compensation and
Development Committee, which currently consists of Mr. Macey as Chairman,
Messrs. Franklin, McKinnell, Sutherland and P. Wiley, administers the executive
compensation program and monitors executive development practices. It oversees
compliance with governmental regulations and accounting standards with respect
to employee compensation and benefit programs; reviews the principles and
policies for compensation and benefit programs company-wide, and monitors the
implementation and administration of such programs. It also grants options and
makes awards under the Company's 1991 Key Employee Stock Plan. The committee
reports to the Board of Directors its recommendations and observations with
respect to the foregoing. The committee met four times during fiscal 1997.
Finance Committee. The Finance Committee, which currently consists of Mr.
Fernandes as Chairman, Ms. Wiley, Messrs. Baker, Franklin and McKinnell, reviews
the operating and capital spending plans and reviews proposed acquisitions,
investments, and divestitures within designated limits. It maintains financial
oversight of the Company's employees' retirement and other benefit plans, and
makes recommendations to the Board with respect to such matters, and with
respect to dividends on the Company's capital stock. The committee met four
times during fiscal 1997.
Committee on Directors. The Committee on Directors, which currently consists of
Mr. Sutherland as Chairman, Messrs. Fernald, Herrington and P. Wiley, makes
recommendations to the Board regarding the size and composition of the Board;
identifies appropriate general qualifications and criteria for directorships as
well as qualified candidates for election to the Board; assists the Chairman of
the Board in proposing committee assignments; assists the Board in evaluating,
maintaining and improving its own effectiveness; and evaluates director
compensation and benefits and recommends adjustments as appropriate. The
committee met three times during fiscal 1997.
Directors' Compensation
Directors who are not employees of the Company receive an annual retainer
of $12,000 and committee chairmen receive an additional annual retainer of
$3,000. Non-employee directors receive $1,000 per meeting for attendance at each
Board or committee meeting. Directors also receive $1,000 per diem for special
assignments performed at the request of the Company. Directors who are employees
do not receive an annual retainer or a fee for attendance at Board or committee
meetings.
4
<PAGE>
Pursuant to the Company's 1990 Director Stock Plan (the "Director Plan"),
non-employee directors receive an automatic annual award of shares of Class A
Stock equal in value to 50 percent of the total cash compensation, excluding
expense reimbursement, received by such directors. The shares are valued at
their closing price on the date of the annual shareholders meeting or, if no
shares were traded on such date, on the next preceding date on which the shares
were so traded, and are issued as soon as practicable thereafter based on
compensation received for services rendered since the last annual meeting. The
total number of shares awarded in fiscal 1997 was 5,394 Class A shares at the
market value of $29.25. Under the Director Plan, eligible directors may also
elect to receive all or a portion of their cash compensation in the form of
Class A Common Stock. Seven directors currently have so elected.
The Company has a Deferred Compensation Plan for Directors' Fees ("Deferred
Plan"), in which directors who are not employees of the Company, or are not
otherwise eligible to receive director fees, are eligible to participate. The
purpose of the Deferred Plan is to provide eligible directors with flexibility
in their tax planning. Under the Deferred Plan, an eligible director may elect
on or before December 31 of any year to defer receipt of all fees or
compensation received as a member of the Board of Directors for services
rendered during the calendar year following such election and succeeding
calendar years, including fees paid for attendance at meetings of the Board of
Directors or its committees, but not including any stock awarded under the
Director Plan or any other stock plan which may hereafter be adopted. No
directors currently participate in this plan.
Other Transactions
On July 23, 1996 the Company entered into an agreement with A. T. Kearney,
Inc., of which Gary J. Fernandes is Chairman of the Board, to provide
professional services in connection with a review of certain of the Company's
operating units at a total cost of $410,000. A. T. Kearney, Inc. was selected
pursuant to a competitive bidding process on overall terms no less favorable
than were obtainable from an unrelated third party.
Insurance with Respect to Indemnification of Directors and Officers
The By-Laws of the Company provide for indemnification of directors and
officers in connection with claims arising from service to the Company, to the
extent permitted under the New York State Business Corporation Law. The Company
carries insurance in the amount of $20,000,000 with Chubb Insurance Company and
the National Union Insurance Company at an annual premium of $192,000. The
current policy expires on November 14, 1997. No sums have been paid under this
policy.
III. Election of Directors
Fifteen (15) directors are to be elected to hold office until the next
Annual Meeting of Shareholders and until their successors are elected and
qualified. Unless contrary instructions are indicated or the proxy is previously
revoked, it is the intention of management to vote proxies received for the
election of the persons named below as directors. Directors of each class are
elected by a plurality of votes cast by that class. If you do not wish your
shares to be voted for particular nominees, please so indicate in the space
provided on the proxy card. THE HOLDERS OF CLASS ASTOCK ARE ENTITLED TO ELECT
30% OF THE ENTIRE BOARD. AS A CONSEQUENCE, FIVE (5)DIRECTORS WILL BE ELECTED BY
CLASS VOTE OF THE HOLDERS OF CLASS ASTOCK. THE HOLDERS OF CLASS B STOCK ARE
ENTITLED TO ELECT TEN (10)DIRECTORS.
All the nominees are currently directors of the Company, and all were
elected to their present terms of office at the Annual Meeting of Shareholders
held in September 1996. Except as otherwise indicated, all of the nominees have
been engaged in their present principal occupations or in executive capacities
with the same employers for more than the past five years.
The persons named on the proxy cards (Bradford Wiley II, Charles R. Ellis
and Josephine A. Bacchi) have agreed to represent shareholders submitting
properly executed proxy cards and to vote for the election of the nominees
listed herein, unless otherwise directed by the authority granted or withheld on
the proxy cards. Although the Board of Directors has no reason to believe that
any of the persons named below as nominees will be unable or decline to serve,
if any such person is unable or declines to serve, the persons named in the
accompanying proxy card may vote for another person at their discretion.
5
<PAGE>
Directors to be Elected by Class A Shareholders
- - --------------------------------------------------------------------------------
[PHOTO]
Larry Franklin, a director since 1994, is President, Chief Executive Officer and
Director of Harte-Hanks Communications, Inc. He is a Member of the Board of
Governors of Newspaper Association of America; a Director of Associated Press;
Vice Chairman of the Board of Governors of San Antonio Economic Development
Foundation; a Director of United Way of San Antonio and Bexar County; and a
Director of Southwest Foundation for Biomedical Research. Age 55.
[PHOTO]
John S. Herrington, a director since 1994, is a Businessman/Attorney. He was
Chairman of the Board of Harcourt Brace Jovanovich (a publishing company) from
1989 to 1991; former U.S. Secretary of Energy from 1985 to 1989; and is a
Director of Mesa Petroleum Company. Age 58.
[PHOTO]
Chester O. Macey, a director since 1994, is a private consultant. He was
Executive Vice President and General Manager, Steering, Suspension & Engine
Group, TRW Inc. until his retirement in December 1995. He is past Chairman of
the Canadian Automotive Parts Manufacturers Association; a Director of Motor and
Equipment Manufacturers Association/Japan Automobile Manufacturers Association;
and a Member of Society of Automotive Engineers. Age 59.
[PHOTO]
Henry A. McKinnell, Jr., a director since 1996, has been President, Pfizer
Pharmaceuticals since January 1996. He has been Executive Vice President,
Pfizer, Inc. responsible for Pfizer's U.S. Pharmaceuticals, Consumer and
Strategic Planning and Public Policy Groups since July 1995. These groups
continue to report to him. Previously, he served as Executive Vice President and
Chief Financial Officer of Pfizer, Inc., and President of Pfizer's Hospital
Products Group from 1992 to 1995. He is a Director of Aviall, Inc.; Chairman of
the Food and Drug Law Institute; Vice Chairman of the Committee for Economic
Development; and a Trustee of the New York City Police Foundation. Age 54.
[PHOTO]
Thomas M. Taylor, a director since 1994, has been President of Thomas M. Taylor
& Co. (an investment entity affiliated with the Bass Management Trust) since
1985. He is Chairman of the Board of La Quinta Inns, Inc.; Chairman of Encal
Energy Ltd.; a Director of Kirby Corp.; and a Director of MacMillan Bloedel Ltd.
Age 54.
6
<PAGE>
Directors to be Elected by Class B Shareholders
- - -------------------------------------------------------------------------------
[PHOTO]
Franklin E. Agnew, a director since 1989, has been a Business Consultant since
1986. He was previously Trustee (in Bankruptcy), Sharon Steel from 1989 to 1990.
He is a Director of Bausch & Lomb, Inc.; a Director of Prudential Insurance
Company of America; a Director of Saint Margaret Hospital in Pittsburgh; and is
a Charter Trustee (emeritus) of Princeton University. Age 63.
[PHOTO]
Warren J. Baker, a director since 1993, has been President, California
Polytechnic State University since 1979 and was a Member of the National Science
Board from 1985 to 1994. He is a Regent of the American Architectural
Foundation; a Fellow in the American Society of Civil Engineers; a Member of the
Board of Directors of the California Council on Science and Technology; a Member
of the California Business-Higher Education Forum; and Co-Chair of the
California Joint Policy on Agriculture and Higher Education. Age 59.
[PHOTO]
Charles R. Ellis, a director since 1990, has been President and Chief Executive
Officer of the Company since June 1990. He was previously Executive Vice
President and President of the Company's Publishing Group since June 1989, and
before that Senior Vice President since February 1988. He was President of
Elsevier Science Publishing, U.S.A., from 1981 to 1988. He is Chairman of the
Board of Trustees of Princeton University Press; Vice President of the
International Publishers Association; and a Member of the Board of Directors of
the Association of American Publishers. Age 62.
[PHOTO]
H. Allen Fernald, a director since 1979, is President and Chief Executive
Officer of Down East Enterprise, Inc. (magazine and book publisher). He is a
Director of Maine Community Foundation; a member and past Chair of the
University of Maine President's Council; a Director of United Publishing, Inc.;
a Director of Foreside Company, Inc.; and a Director of the University of Maine
Press. Age 65.
[PHOTO]
Gary J. Fernandes, a director since 1989, is Vice Chairman of EDS, and was
Senior Vice President and Director since 1981. He is a Director of Southland
Corporation; a Director of Amtech Corporation; Chairman of the Board of A.T.
Kearney, Inc.; a Trustee for The New School for Social Research; and a Member of
the Board of Governors of Boys & Girls Clubs of America.
Age 54.
7
<PAGE>
Directors to be Elected by Class B Shareholders
- - --------------------------------------------------------------------------------
[PHOTO]
William R. Sutherland, a director since 1987, is Vice President, Sun
Microsystems, Inc. and has been the Director of Sun Microsystems Laboratories
since July 1993. He was previously Deputy Director since March 1991, and was
Vice President and Treasurer, Sutherland Sproull & Associates, Inc. (information
and technology consulting firm). He is a partner in Advanced Technology
Ventures, a venture capital firm, and a former Director of Newmarket Venture
Capital, PLC. Age 61.
[PHOTO]
Leo J. Thomas, a director since 1988, was Executive Vice President of Eastman
Kodak Company since 1994 and a Director of Eastman Kodak Company from May 1992
until his retirement in May 1996. He was previously Group Vice President and
General Manager of Health Group from September 1989 to September 1991, and Group
Vice President, President of Imaging from September 1991 to August 1994. He is a
Director of Frontier Corporation and a member of the National Academy of
Engineering. Age 60.
[PHOTO]
Bradford Wiley II, a director since 1979, has been Chairman of the Board since
January 1993, and Editor in the College Division since April 1989. He was
previously a newspaper journalist, viticulturist and winery manager. Age 56.
[PHOTO]
Deborah E. Wiley, a director since 1979, is a Senior Vice President, and
Director of Corporate Communications since July 1994. She was previously Vice
Chairman of the Board from 1986 to 1994. She is Chairman of the Board of Caedmon
School; a Trustee of The Aloha Foundation; a Trustee Emerita of Colgate
University; a Trustee of Pine Manor College; and Chairman of the Board of the
National Book Foundation. Age 51.
[PHOTO]
Peter Booth Wiley, a director since 1984, is an author, journalist and owner of
Points West (newspaper articles). He is a Member of the Board of the Friends of
the San Francisco Library; and a member of the Board of the Data Center. Age 54.
8
<PAGE>
Beneficial Ownership of Directors and Management
Set forth below are the shares of the Company's Class A and Class B Stock
beneficially owned by the directors, and also executive officers named in the
Summary Compensation Table on page 13 as of August 1, 1997.
<TABLE>
<CAPTION>
- - ---------------------------------------------------------------------------------------------------------
Shares of
Class A and Additional
Class B Stock Shares Percent
Beneficially Beneficially of
Owned(1) Owned(2) Totals Class(1)
- - ---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Franklin E. Agnew A 16,833 A 16,833 0.1%
B -- B -- --
Warren J. Baker A 1,940 A 1,940 --
B -- B -- --
Charles R. Ellis(3)(4) A 126,549 A 94,896 A 221,445 1.7%
B -- B -- B -- --
H. Allen Fernald A 8,023 A 8,023 --
B 1,360 B 1,360 --
Gary J. Fernandes A 5,642 A 5,642 --
B -- B -- --
Larry Franklin A 3,045 A 3,045 --
B -- B -- --
John S. Herrington A 828 A 828 --
B -- B -- --
Stephen A. Kippur(3)(4) A 54,561 A 31,188 A 85,749 0.7%
B -- B -- B -- --
Chester O. Macey A 1,983 A 1,983 --
B -- B -- --
Henry A. McKinnell, Jr. A 500 A 500 --
B -- B -- --
William J. Pesce(3)(4) A 52,485 A 33,046 A 85,531 0.7%
B -- B -- B -- --
Richard S. Rudick(3) A 60,879 A 27,407 A 88,286 0.7%
B 14,144 B -- B 14,144 0.4%
William R. Sutherland A 6,257 A 6,257 --
B -- B -- --
Thomas M. Taylor(12) A 75,148 A 75,148 --
B -- B -- --
Leo J. Thomas A 13,430 A 13,430 0.1%
B 800 B 800 --
Robert D. Wilder(3)(4) A 51,947 A 21,576 A 73,523 0.6%
B 1,600 B -- B 1,600 --
Bradford Wiley II(5)(6)(9)(11) A 109,708 A 109,708 0.9%
B 363,265 B 363,265 11.5%
Deborah E. Wiley(5)(6)(7)(10)(11) A 140,938 A 452 A 141,390 1.1%
B 542,834 B -- B 542,834 17.2%
Peter Booth Wiley(5)(6)(8)(11) A 115,460 A 115,460 0.9%
B 363,294 B 363,294 11.5%
- - -----------------------------------------------------------------------------------------------------
</TABLE>
(1) All directors, nominees and executive officers as a group (includes 22
persons) own 1,141,847 and 1,287,301 shares of Class A and B Stock,
including exercisable options and restricted shares awarded to certain
executive officers, (see Executive Employment Agreements, page 15). This
represents 15% of the Common Stock of the Company and 31.3% of the voting
power represented by all such shares, excluding restricted shares which may
not be voted until vested. In the table, percent of class was calculated on
the basis of shares beneficially owned (including exercisable options),
compared with shares issued and outstanding plus shares which might be
issued pursuant to the exercise of such options. This table is based on the
information provided by the individual nominees.
9
<PAGE>
(2) Options exercisable under the Company's stock option plans which may be
acquired on or before October 1, 1997.
(3) Includes Class A shares of restricted stock subject to forfeiture awarded
under the Company's long term incentive plans (see Summary Compensation
Table, footnote (a), page 13) as follows: Mr. Ellis - 19,940 shares; Mr.
Pesce - 7,891 shares; Mr. Kippur - 7,612; Mr. Wilder - 5,653 shares; and
Mr. Rudick - 3,139 shares. (4) Includes restricted stock subject to
forfeiture awarded under the terms of the Executive Employment Agreements,
described on page 15, as follows: Mr. Ellis - 54,810 shares; Mr. Pesce -
36,666 shares; Mr. Kippur - 36,982 shares; and Mr. Wilder - 36,606 shares.
(5) The totals shown for Bradford Wiley II, Deborah E. Wiley and Peter Booth
Wiley do not include any shares in the table on page 2 as separately owned
by their father, W. Bradford Wiley (namely 653,228 Class A and 412,252
Class B shares), nor do they include (i) 201,280 shares of Class A Stock
and 134,188 shares of Class B Stock held by a trust for the benefit of W.
Bradford Wiley, of which Mr. Wiley and Morgan Guaranty Trust Company of New
York are co-trustees; (ii) 88,620 shares of Class B Stock which W. Bradford
Wiley or his designees have the right to acquire in exchange for shares of
Class A Stock from certain persons upon any proposed disposition of such
Class B Stock, upon their deaths or upon termination of trust; or (iii) the
shares not allocated to any of W. Bradford Wiley's children under the
trusts referred to in footnotes (4), (5), (6), (7) or (8) below.
(6) Peter Booth Wiley, Bradford Wiley II and Deborah E. Wiley, and their
father, W. Bradford Wiley, as co-trustees, share voting and/or investment
power with respect to 1,060,156 shares of Class B Stock under the Will of
Edward P. Hamilton. For purposes of this table, each of W. Bradford Wiley's
children is shown as the owner of one-fourth of such shares.
(7) Deborah E. Wiley and her father, W. Bradford Wiley, as co-trustees, share
voting and/or investment power with respect to 109,380 shares of Class B
Stock under the Edward P. Hamilton Trust, 27,420 shares of Class A Stock
and 212,840 shares of Class B Stock under the Elizabeth W. Hamilton Trust,
and 218,784 shares of Class A Stock and 145,856 shares of Class B Stock
under a trust for the benefit of Bradford Wiley II. For purposes of this
table, Deborah E. Wiley is shown as the owner of one-half of such shares.
(8) Peter Booth Wiley and his father, W. Bradford Wiley, as co-trustees, share
voting and/or investment power with respect to 218,784 shares of Class A
Stock and 145,856 shares of Class B Stock under a trust for the benefit of
Deborah E. Wiley. For purposes of this table, Peter Booth Wiley is shown as
the owner of one-half of such shares.
(9) Bradford Wiley II and his father, W. Bradford Wiley, as co-trustees, share
voting and/or investment power with respect to 218,784 shares of Class A
Stock and 145,856 shares of Class B Stock under a trust for the benefit of
Peter Booth Wiley. For purposes of this table, Bradford Wiley II is shown
as the owner of one-half of such shares.
(10) Deborah E. Wiley and her father, W. Bradford Wiley, as co-trustees, share
voting and/or investment power with respect to 13,768 shares of Class A
Stock and 9,180 shares of Class B Stock under the Trust of Esther B. Wiley.
For purposes of this table, Deborah E. Wiley is shown as the owner of
one-half of these shares.
(11) Bradford Wiley II, Deborah E. Wiley and Peter B. Wiley, as general partners
of a limited partnership, share voting and/or investment power with respect
to 72,420 shares of Class B Stock owned by the limited partnership. For
purposes of this table, each is shown as a owner of one-third of such
shares.
(12) Portfolio I Investors, L.P. ("Portfolio I") is a direct beneficial owner of
65,100 shares of Class A Stock reported herein, and Thomas M. Taylor & Co.
("Taylor & Co.") is the beneficial owner of 9,100 shares of Class A stock
reported herein. Mr. Taylor may be deemed to be the beneficial owner of the
shares owned by Portfolio I because of his position as the President and
sole stockholder of Trinity Capital Management, Inc., which is the sole
general partner of Trinity I Fund, L.P., which is the sole stockholder of
Portfolio Associates, Inc., which in turn is the sole general partner of
Portfolio I. Mr. Taylor may be deemed to be the beneficial owner of the
shares owned by Taylor & Co. because he is the President and a controlling
person of Taylor & Co.
- - --------------------------------------------------------------------------------
10
<PAGE>
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
officers and directors, and persons who own more than ten percent of a
registered class of the Company's equity securities, to file reports of
ownership and changes in ownership with the Securities and Exchange Commission
and the New York Stock Exchange. Officers, directors and greater than ten
percent shareholders are required by SEC regulation to furnish the Company with
copies of all Section 16(a) forms they file.
Based on its review of the copies of such forms received by it, or written
representations from certain reporting persons that no Forms 5 were required for
those persons, the Company believes that during fiscal 1997, all filing
requirements applicable to its officers, directors and greater than ten percent
beneficial owners were complied with, except that one report covering one
transaction for 100 Class A shares was filed late by William J. Pesce.
IV. Executive Compensation
Report of the Executive Compensation and Development Committee
Executive Compensation Policies. The Company's executive compensation program is
administered by the Executive Compensation and Development Committee of the
Board of Directors (the "Committee") composed of five independent directors. The
objectives which guide the Committee in formulating its recommendations are to:
o Attract and retain executives of the highest caliber by compensating
them at levels which are competitive in the market place.
o Motivate and reward such executives based on corporate, business unit
and individual performance through compensation systems and policies
which include variable incentives.
o Align executives' and shareholders' interests through awards of equity
components dependent upon the performance of the Company and the
operating divisions, as well as the individual performance of each
executive.
Annually the Committee reviews a compensation survey as a guidepost to
determine whether the Company's compensation levels and program are competitive
and meet the Committee's stated objectives. The most recent survey compiled by
Towers Perrin includes those publishing companies listed in the peer group in
the graph on page 13, regarded as comparable and for which comparable data is
available, as well as other companies more comparable in size to the Company.
The Committee recommends to the Board for its ultimate determination the total
targeted compensation and the proportion of the various components of the
compensation program including salary and targeted annual and long term
incentives, based upon each executive's role in the Company and level of
responsibilities.
It is the Committee's policy to maximize the effectiveness of the Company's
executive compensation programs. With regard to future executive compensation
actions, the Committee's policy is to maintain flexibility to take actions which
it deems to be in the best interests of the Company and its shareholders, but
which may not qualify for tax deductibility under Section 162(m) or other
Sections of the Internal Revenue Code.
Annual Executive Compensation. Annual executive compensation is comprised of
base salary and, if earned, a variable cash incentive. The annual incentive is
based on the achievement of quantitative financial performance goals, as well as
individual non-quantitative objectives. Targeted annual incentives range from
70% of salary for Mr. Ellis and from 40% to 60% for other executives. At the
beginning of each fiscal year, the Committee recommends to the Board for
approval the base salaries, the targeted incentives, the financial performance
measures and goals on which incentives may be earned, including the threshold or
minimum level of performance below which no incentives will be paid. Divisional
performance measures and targets are also set for certain operating executives
with divisional as well as corporate responsibilities.
At the end of the fiscal year, the Committee evaluates performance against
the financial goals and individual objectives, and submits to the full Board for
approval a recommended annual payout, if any, for each executive. No incentive
is payable, regardless of whether individual objectives are met or exceeded,
unless aggregate performance against the financial measures equals or exceeds
threshold. Payouts, if any, can range from 50% to 150% of the targeted incentive
depending upon the level of the achievement of financial goals and individual
objectives between threshold and outstanding levels of performance. In fiscal
1997 on a weighted average basis, performance against financial goals was above
target.
11
<PAGE>
Long Term Executive Compensation. The long term component of the compensation is
comprised of (i) a targeted variable incentive payable in cash and/or
performance shares, and (ii) stock option grants of Class A Stock. At the
beginning of each year a new three fiscal-year cycle begins. The Committee
reviews and submits to the full Board for approval its recommendations for
participants in the long term plan, the number of stock options to be granted,
the targeted incentive, the financial performance measures and goals, and
threshold and outstanding levels of performance that must be achieved by the
Company and, where relevant, the division for which the participant is
responsible.
At the end of the three fiscal-year cycle, the Committee evaluates
performance against the goals and recommends to the full Board for approval the
appropriate payout for each executive and the portion to be paid in cash and/or
restricted performance shares. No long term incentive is payable if aggregate
performance is less than threshold. Payouts to individual executives can range
from 50% to 150% of the targeted incentive depending upon the level of aggregate
achievement between the threshold and outstanding levels of financial
performance.
Option grants are generally awarded on an annual basis, have terms of ten
years and generally vest as to 50% in the fourth year and 50% in the fifth year
from the date of grant. All employees' stock options have exercise prices which
are equal to the current market price of Class A Stock as of the grant date. The
ultimate value of the stock option grants is aligned with increases in
shareholder value and is dependent upon increases in the market price per share
over and above the grant price. In fiscal 1997, all executives, including Mr.
Ellis, received approximately 60% of their targeted long term incentive in stock
option awards. Chief Executive Officer Compensation. Based on the Executive and
Policy Committee's performance evaluation review of Mr. Ellis, the Executive
Compensation and Development Committee recommended and the Board approved a base
salary increase of 11% ($407,000 to $450,000) and an annual incentive award of
$398,494 representing 47% of the total annual compensation.
The performance review reflected the achievement of financial, as well as
certain strategic goals, and Mr. Ellis' contribution to those achievements.
Mr. Ellis also received a long term compensation payout of $264,031, of
which $176,109 was paid in cash and the remainder in 2,919 shares of restricted
performance shares with the restrictions lapsing as to 50% at the end of fiscal
1998 and 1999, respectively. This payout was based on performance against net
income, cash flow and return on investment goals.
During fiscal 1997, Mr. Ellis, as part of his long term compensation plan,
received a grant of options to purchase 36,223 shares of Class A Stock,
exercisable as to 18,112 shares on and after April 30, 2000, and 18,111 on and
after April 30, 2001, at an option price of $30.375 per share, the market price
at date of grant. In approving the compensation reflected in the tables on page
13, the Committee considered Mr. Ellis's performance in leading the Company's
investment in and enhancing of its core business on a global basis, and the
shareholder value created during the most recent three years of his tenure.
Executive Compensation and Development Committee
Chester O. Macey, Chairman
Larry Franklin William R. Sutherland
Henry A. McKinnell, Jr. Peter B. Wiley
12
<PAGE>
Performance Graph
[THE FOLLOWING TABLE WAS REPRESENTED BY A LINE GRAPH IN THE PRINTED MATERIAL]
<TABLE>
<CAPTION>
1992 1993 1994 1995 1996 1997
--------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
John Wiley &Sons, Inc. Class A $100.00 $122.20 $222.90 $294.30 $366.20 $323.00
Publishing Peer Group 100.00 121.00 131.40 164.70 187.90 207.50
S&PMid-Cap Companies 100.00 112.10 120.70 129.80 165.60 179.60
- - --------------------------------------------------------------------------------------------------------
</TABLE>
The above graph provides an indicator of the cumulative total return to
shareholders of the Company's Class Acommon stock as compared with the
cumulative total return on the S&P Mid-Cap Companies Index and a peer group
index for the period from April 30, 1992 to April 30, 1997. The peer group
consists of the following five publicly traded companies with significant
publishing activities: Harcourt General, Inc.; Houghton Mifflin Company; McGraw
Hill Companies; Plenum Publishing Corporation; and Waverly, Inc. Peer group
returns have been weighted to reflect relative stock market capitalization of
each company at the beginning of each year. Cumulative total return assumes $100
invested on April 30, 1992 and reinvestment of dividends throughout the period.
- - --------------------------------------------------------------------------------
Summary Compensation Table
<TABLE>
<CAPTION>
Long Term Compensation
---------------------------------------
Annual Compensation Awards Payouts
----------------------------------------- ----------------------------- --------
Other Annual Securities All Other
Name and Compen- Restricted Stock Underlying LTIP Compen-
Principal Position Year Salary Bonus sation Awards(a) Option/SARs Payouts(b) sation(c)
- - ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Charles R. Ellis 1997 $443,388 $398,494 $0 $ 87,922 36,223 $176,109 $ 4,946
President, Chief Executive 1996 401,312 348,333 0 916,139 28,328 137,484 4,884
Officer and Director 1995 362,314 300,518 0 702,579 55,000 149,132 5,019
William J Pesce 1997 296,928 244,253 0 17,838 15,806 35,731 4,829
Chief Operating Officer(d) 1996 251,082 131,052 0 581,648 29,052 33,345 4,877
1995 229,692 80,347 0 441,093 7,000 44,754 4,620
Stephen A. Kippur 1997 286,004 107,366 0 27,164 14,884 54,411 4,770
Executive Vice President 1996 264,004 129,977 0 592,810 11,126 55,704 4,668
and Group President, 1995 239,539 146,574 0 452,099 7,000 66,797 4,712
Professional, Reference
and Trade Group
Robert D. Wilder 1997 228,923 140,654 0 25,263 9,549 50,803 4,573
Executive Vice President 1996 221,308 120,435 0 589,024 8,376 48,119 4,614
and Chief Financial and 1995 210,154 106,400 0 445,176 6,600 52,931 4,625
Support Operations Officer
Richard S. Rudick 1997 176,769 83,541 0 14,243 5,650 28,528 4,583
Senior Vice President 1996 168,462 81,100 0 12,910 4,314 25,858 4,604
and General Counsel 1995 159,154 70,899 0 15,074 3,600 30,194 4,557
- - ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
The above table sets forth, for the fiscal years indicated, the compensation of
the CEOand the four other most highly compensated executive officers of the
Company.
(a) When awards of restricted stock are made pursuant to the Company's
long-term incentive plans, the Committee may establish a period during
which the Class A shares of restricted stock shall be subject to forfeiture
in whole or in part if specified objectives or considerations are not met.
Restricted stock awards were made for achievement of financial performance
objectives for the respective three-year periods ended April 30, 1997,
April 30, 1996 and April 30, 1995. Stock issued pursuant thereto is
non-voting and not eligible for dividends until restrictions lapse.
Restrictions lapse as to 50%
13
<PAGE>
at the end of the first and second fiscal year, respectively, after the
fiscal year in which awarded. Restricted stock awards reflect the market
value as of the fiscal year-end indicated. In addition to the
aforementioned stock awards, this amount includes the value at the date of
issuance of restricted stock, which have voting rights and are eligible to
receive dividends, issued pursuant to certain Employment Agreements in
fiscal year 1996 as follows:Mr. Ellis-30,000 shares valued at $847,500; Mr.
Pesce-20,000 shares valued at $565,000; Mr. Kippur-20,000 shares valued at
$565,000; and Mr. Wilder-20,000 shares valued at $565,000. Similar awards
were granted under the Employment Agreements in fiscal year 1995 as
follows:Mr. Ellis-30,000 shares valued at $628,125; Mr. Pesce-20,000 shares
valued at $418,750; Mr. Kippur-20,000 shares valued at $418,750; and Mr.
Wilder-20,000 shares valued $418,750. Aggregate restricted stock holdings
as of April 30, 1997 were as follows: Mr. Ellis - 71,480 shares valued at
$2,153,335; Mr. Pesce - 44,013 shares valued at $1,325,892; Mr.
Kippur-44,587 shares valued at $1,343,183; Mr. Wilder-43,333 shares valued
at $1,305,407; and Mr. Rudick-1,798 shares valued at $54,165.
(b) Under the Company's long term incentive plans, cash awards were made for
the achievement of financial performance objectives for the respective
three year periods ended April 30, 1997, 1996 and 1995. as described in the
report of the Executive Compensation and Development Committee under the
heading Long Term Executive Compensation on page 12.
(c) Represents matching Company contributions to the Employee Savings Plan.
(d) Executive Vice-President-Educational and International Group untill April
30, 1997.
Option/SAR Grants in Last Fiscal Year
<TABLE>
<CAPTION>
- - -------------------------------------------------------------------------------------------------------------
Individual Grants (a)
- - --------------------------------------------------------------------------------
Potential Realizable
% of Total Value at Assumed
Number of Options/SARs Annual Rates of Stock Price
Securities Granted to Appreciation for Option Term
Underlying Options/ Employees Exercise or Expiration ----------------------------
Name SARs Granted in Fiscal Year Base Price Date (b) 5% 10%
- - -------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Charles R. Ellis 36,223 25.3% $30.375 June 12, 2006 $691,956 $1,753,553
William J. Pesce 15,806 11.0% 30.375 June 12, 2006 301,937 765,167
Stephen A. Kippur 14,884 10.4% 30.375 June 12, 2006 284,324 720,533
Robert D. Wilder 9,549 6.7% 30.375 June 12, 2006 182,411 462,266
Richard S. Rudick 5,650 3.9% 30.375 June 12, 2006 107,930 273,516
- - -------------------------------------------------------------------------------------------------------------
</TABLE>
The above table shows potential realizable value at assumed annual stock
appreciation rates of 5% and 10%over the ten-year term of the options. The rates
of appreciation are as required to be stated by the Securities and Exchange
Commission and are not intended to forecast possible future actual appreciation,
if any, in the Company's stock price. Future gains, if any, will depend on
actual future appreciation in the market price.
(a) The Company has in effect two shareholder approved plans, each of which
relates to Class Ashares: the 1987 Incentive Stock Option and Performance
Stock Plan, and the 1991 Key Employee Stock Plan. The exercise price of all
stock options is determined by the Committee and may not be less than 100
percent of the fair market value of the stock on the date of grant of the
options. The Committee also determines at the time of grant the period and
conditions for vesting of stock options. In the event of a change of
control, as defined on page 17, all outstanding options shall become
immediately exercisable up to the full number of shares covered by the
option. No option grants have SARs associated with the grants, and no SARs
were granted during fiscal 1997.
(b) Options are subject upon earlier termination in certain events relating to
termination of employment.
Aggregated Option/SAR Exercises in Last Fiscal Year and Fiscal Year-End
Option/SAR Values
<TABLE>
<CAPTION>
- - --------------------------------------------------------------------------------------------------------------
Number of Securities Value of Unexercised
Underlying Unexercised In-the-Money Options/SARs
Shares Acquired Value Options/SARs at Fiscal Year-End at Fiscal Year-End (b)
------------------------------- --------------------------
Name on Exercise Realized(a) Exercisable Unexercisable Exercisable Unexercisable
- - --------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Charles R. Ellis 0 $0 102,676 102,623 $1,719,203 $386,626
William J. Pesce 0 0 33,046 49,216 570,434 126,363
Stephen A. Kippur 24,000 458,521 31,188 35,662 637,903 135,654
Robert D. Wilder 40,000 801,624 21,576 26,998 441,944 123,489
Richard S. Rudick 0 0 27,407 14,894 554,949 66,503
- - --------------------------------------------------------------------------------------------------------------
</TABLE>
The above table provides information as to options exercised by each of the
named executive officers during fiscal 1997 and the value of the remaining
options held by each executive officer at year end, measured using the closing
price of $30.125 for the Company's Class ACommon Stock on April 30, 1997.
(a) Market value of underlying shares at exercise minus the option price
(b) Market value of underlying shares at fiscal year-end minus the option
price. These values are presented pursuant to SEC rules. The actual amount,
if any, realized upon exercise will depend upon the market price of the
Class Ashares relative to the exercise price per share of the stock options
at the time of exercise.
14
<PAGE>
Long-Term Incentive Plans -- Awards in Last Fiscal Year
<TABLE>
<CAPTION>
Estimated Future Payouts
under Non-Stock Priced-Based Plans (a)(b)
Number of Performance or ------------------------------------------
Shares, Units or Other Periods Until Threshold Target Maximum
Name Other Rights(#) Maturation or Payout (# or $) (# or $) (# or $)
- - -------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Charles R. Ellis 3,607 May 1, 1996 to April 30, 1999 902 3,607 5,411
$27,500 $110,000 $165,000
William J. Pesce 1,574 May 1, 1996 to April 30, 1999 590 1,574 2,361
$18,000 $48,000 $72,000
Stephen A, Kippur 1,482 May 1, 1996 to April 30, 1999 556 1,482 2,223
$16,950 $45,200 $67,800
Robert D. Wilder 951 May 1, 1996 to April 30, 1999 238 951 1,427
$7,250 $29,000 $43,500
Richard S. Rudick 563 May 1, 1996 to April 30, 1999 141 563 845
$4,290 $17,160 $25,740
- - -------------------------------------------------------------------------------------------------------------
</TABLE>
Estimated future payments assuming financial performance targets are achieved
under the 1997 long-term incentive compensation plan for the named executives
are as indicated above:
(a) Financial performance targets and relative weighting of each target, as
well as the threshold, target and outstanding levels of performance, are
set at the beginning of the three-year plan cycle and include cumulative
income and cumulative cash flow, as defined, for the three-year period. For
the fiscal 1997 long-term plan, amounts will be earned based on the
achievement of the overall weighted targets. If the threshold level is not
attained, no payout will be made.
(b) These awards consist partly of cash and partly of restricted performance
shares. At April 30, 1999, the Committee may, in its discretion, modify the
relative proportion of cash and restricted performance shares. The
restricted shares would vest as to 50% on April 30, 2000 and the remaining
50% on April 30, 2001. The above restricted shares are not eligible for
dividends and voting rights during the three-year plan cycle.
Executive Empoyment Agreements
In July 1994, the Company entered into employment agreements with Charles
R. Ellis, President and Chief Executive Officer, and three senior officers,
Messrs. Pesce, Kippur, and Wilder (collectively the "Executives"). The contracts
provide for base salaries (reflected in the Summary Compensation Table on page
13), which may be increased by the Board, and for benefits and incentive
compensation as provided for senior officers generally, and as described in the
Committee's report above. Each of the contracts with the senior officers expires
on April 30, 1998, and is renewable for successive two-year terms in the absence
of notice by either party to the contrary. If any such contract is terminated by
the Company other than for cause, as defined, or if the Company decides not to
renew for a subsequent term, the Executive will be entitled to 24 months
severance, which includes salary, benefits, pro-rated cash incentive payments at
target levels, and long term incentives for plan cycles ending within one year
after termination. The contract with Mr. Ellis, as amended in March 1995, is for
an initial term expiring on July 20, 1998, renewable for an additional two-year
term. If it is terminated by the Company other than for cause or it is not
renewed by the Company for the additional term, severance is payable until July
20, 2000.
Except in the case of termination by the Company other than for cause, the
Executive is restricted from working for a competitor for twelve months after
termination in the case of the senior officers. The restriction continues until
July 20, 2000, whether or not termination is for cause in the case of the Chief
Executive Officer. However, if any of the Executives resigns for "good reason"
within 18 months following a "change of control," both as defined in the 1989
Supplemental Executive Retirement Plan ("SERP") (see page 16), the restriction
does not apply.
In connection with these agreements, the above named Executives received
certain restricted stock awards which vest one-third at the end of each of the
third, fourth and fifth years after the date of grant. In addition, the
Executive is required to retain ownership of the shares for an additional two
years after vesting except, in Mr. Ellis' case, upon retirement with the Board's
approval. If the Executive is terminated by the Company other than for cause, or
the contract is not renewed by the Company, or if there is a "change of control"
as defined in the 1991 Key Employee Stock Plan (see Stock Options, Performance
Stock and Restricted Stock, page 17, all remaining unvested shares will vest,
and any remaining restrictions on transfer of the shares will lapse.
In January 1997, the Company entered into agreements with senior vice
presidents employed by the parent company (the "Participants"), which provide
for continuation of base salary for a
15
<PAGE>
period of between 12 and 18 months in the event of termination by the Company
other than for cause. In the event of a "change of control," as defined in SERP,
under certain circumstances the Participants may be entitled to cash incentive
payments at target level for the severance period. Except in the case of
termination by the Company other than for cause, or termination for "good
reason," as defined in SERP, following a "change of control," the Participants
are restricted from working for a competitor for a period of four to six months
after termination.
Retirement Plan
The following table shows the estimated annual retirement benefits payable at
normal retirement age to a covered participant who has attained the earnings and
years of service classifications indicated under the Company's tax-qualified,
non-contributory defined benefit retirement plan (the "Retirement Plan") and
non-qualified supplemental retirement plan (the "Supplemental Retirement Plan"):
- - --------------------------------------------------------------------------------
Years of Service
Average -----------------------------------------------------
Final
Compensation 10 20 30 35
- - --------------------------------------------------------------------------------
$100,000 $ 15,246 $ 30,491 $ 45,737 $ 53,360
200,000 31,946 63,891 95,837 111,810
300,000 48,646 97,291 145,937 170,260
400,000 65,346 130,691 196,037 228,710
500,000 82,046 164,091 246,137 287,160
600,000 98,746 197,491 296,237 345,610
700,000 115,446 230,891 346,337 404,060
800,000 132,146 264,291 396,437 462,510
- - --------------------------------------------------------------------------------
Benefits shown above are computed as a single life annuity beginning at age
65 and are not subject to any deduction for offset amounts. The Retirement Plan
provides for annual normal retirement benefits equal to 1.17%of average final
compensation, not in excess of covered compensation, plus 1.67%of average final
compensation in excess of covered compensation, times years of service not to
exceed 35.
Average final compensation is the participant's average annual compensation
(taking into account 100% of the base pay plus 50% of incentive compensation and
overtime pay, but not including any other compensation included in the Summary
Compensation Table) during the highest three consecutive years ending December
31, 1994 (subject to certain limitations on compensation under the Internal
Revenue Code with respect to tax-qualified plans). The Company may, but is not
required to, update from time to time the three-year period used to determine
average final compensation.
Covered compensation under the Retirement Plan is the average of the
taxable wage base in effect under the Social Security Act over the 35 year
period ending with the year the employee reaches his or her social security
retirement age (but excluding any increases in the taxable wage base after
1993). The Supplemental Retirement Plan provides benefits that would otherwise
be denied participants by reason of certain Internal Revenue Code limitations on
tax-qualified plan benefits. Average final compensation and covered compensation
are determined under the Supplemental Retirement Plan in the same manner as
under the Retirement Plan, except that a participant's compensation is not
subject to the limitations under the Internal Revenue Code. Years of service
under the Retirement Plan and Supplemental Retirement Plan are the number of
years and months, limited to 35 years, worked for the Company and its
subsidiaries after attaining age 21.
The years of service for Messrs. Ellis, Pesce, Kippur, Wilder and Rudick
under the Retirement Plan and Supplemental Retirement Plan as of April 30, 1997
(rounded to the nearest year), are 9, 8, 18, 18, and 19, respectively. Average
final compensation under the Retirement Plan for Messrs. Ellis, Pesce, Kippur,
Wilder and Rudick as of April 30, 1997 was $426,644, $250,309, $269,840,
$231,089, and $181,017, respectively.
1989 Supplemental Executive Retirement Plan
The participants under the 1989 Supplemental Executive Retirement Plan
("SERP") are executives of the Company or its affiliates listed on a schedule to
the plan, as amended from time to time.
16
<PAGE>
The basic SERP benefit (the "primary benefit") consists of ten annual
payments commencing on retirement (at or after age 65) determined by multiplying
the participant's base salary rate at retirement by 2.5, reducing the result by
$50,000 and dividing the remainder by five. The plan also provides for an
alternative early retirement benefit for participants who retire after age 55
with five years of service, a reduced payment for participants whose employment
is terminated prior to age 65 other than on account of death (and who do not
qualify for early retirement), and a survivor benefit for the beneficiaries of a
participant who dies prior to age 65 while employed by the Company or an
affiliate.
The estimated annual benefits under SERP payable over ten years upon
retirement at age 65 for Messrs. Ellis, Pesce, Kippur, Wilder and Rudick are
$527,600, $682,600, $382,700, $305,500, and $123,700, respectively.
SERP provides the participants with a guaranteed total annual retirement
benefit beginning at age 65 for ten years (taking into account retirement
benefits under the Company's Retirement Plan, referred to above, the
Supplemental Retirement Plan and the primary benefit under SERP) of 50% to 65%
(depending on the executive's position with the Company) of average compensation
over the executive's highest three consecutive years. Under certain circum-
stances, if a participant works for a competitor within 24 months following
termination of employment, no further payments would be made to the participant
under SERP.
SERP also provides that following a change of control (defined in the same
manner as under the Company's stock option plans discussed below) and the
termination of the participant's employment without cause as defined, or a
termination by the participant for good reason as defined, the participant is
entitled to a lump sum payment of the then present value of his benefits under
SERP computed as if the participant had attained age 65 on the date of his
termination.
Stock Options, Performance Stock, and Restricted Stock
Under the 1991 Key Employee Stock Plan (the "Plan"), qualified employees
are eligible to receive awards that may include stock options, performance stock
awards and restricted stock awards as described in footnote (a) of the Summary
Compensation Table. The number of shares available for stock options or stock
awards is limited to three percent of the total number of shares of Class A
Stock of the Company outstanding as of the first day of each fiscal year during
which the Plan is in effect. No more than 2,000,000 shares may be issued over
the life of the Plan, and no stock option may be granted after December 31,
2000.
Upon a "change of control," as defined, all outstanding options shall
become immediately exercisable up to the full number of shares covered by the
option. The Committee shall specify in a performance stock award whether, and to
what effect, in the event of a change of control, an employee shall be issued
shares of common stock with regard to performance stock awards held by such
employee. Following a change of control, all shares of restricted stock which
would otherwise remain subject to restrictions shall be free of such
restrictions. A change of control is defined as having occurred if either (a)
any "person" hereafter becomes the beneficial owner, directly or indirectly, of
25% or more of the Company's then outstanding shares of Class B Stock (and such
person did not have such 25% or more beneficial ownership on January 1, 1989)
and the number of shares of Class B Stock so owned is equal to or greater than
the number of shares of Class B Stock then owned by any other person, or (b)
individuals who constitute the Board of Directors on January 1, 1989 (the
"incumbent board") cease for any reason to constitute at least 64% of the full
board, provided that any person becoming a director subsequent to such date
whose election or nomination for election by the Company's shareholders was
approved by a vote of at least 64% of the directors comprising the incumbent
board shall be considered as though such person was a member of the incumbent
board. The term "person" includes any individual, corporation, partnership,
group, or association other than the Company, an affiliate of the Company, or
any ESOP or other employee benefit plan sponsored or maintained by the Company
or any affiliate. The Class B shareholders, voting as a class, are entitled to
elect a minimum of 64% of the directors comprising the full board.
V. Proposal to Ratify Appointment of Independent Public Accountants
There will be presented to the meeting a proposal to ratify the appointment
by the Board of Directors, on the recommendation of its Audit Committee, of
Arthur Andersen LLP ("Arthur Andersen") as independent public accountants for
the Company for the fiscal year ending April 30, 1998. Although it is not
required to do so, the Board of Directors is submitting the selection of that
firm for ratification by the shareholders to ascertain their views on such
selection. Arthur
17
<PAGE>
Andersen has audited the Company's accounts since 1967. Arthur Andersen has
advised the Company that during such period neither that firm nor any of its
members has or has had any direct or any materially indirect financial interest
in the Company or any of its subsidiaries. A representative of Arthur Andersen
is expected to be present at the Annual Meeting with the opportunity to make a
statement if he desires to do so, and such representative is expected to be
available to respond to appropriate questions.
Unless contrary instructions are noted thereon, the proxies will be voted
in favor of the following resolution, which will be submitted at the meeting:
"RESOLVED, that the appointment by the Board of Directors of Arthur
Andersen LLP as independent public accountants for the Company for the
fiscal year ending April 30, 1998, be and it hereby is ratified, confirmed
and approved."
The affirmative vote of the shares representing a majority of the number of
votes accorded to all outstanding shares of the Company (each share of Class A
Stock being accorded one-tenth of one vote and each share of Class B Stock being
accorded one vote) present in person or by proxy at the meeting and voting on
the proposal is necessary for the adoption of the proposal. In the event that
the foregoing proposal is defeated, the adverse vote will be considered as a
direction to the Board of Directors to select other auditors for the following
year. However, because of the difficulty and expense of making any substitution
of auditors so long after the beginning of the current fiscal year, it is
contemplated that the appointment for the fiscal year ending April 30, 1998 will
be permitted to stand unless the Board of Directors finds other good reason for
making a change.
The Board of Directors recommends that you vote "FOR" the ratification of
the appointment of independent public accountants.
VI. Manner and Expenses of Solicitation
Since many of our shareholders are unable to attend the Annual Meeting, the
Board of Directors solicits proxies so that each shareholder has the opportunity
to vote on the proposals to be considered at the Annual Meeting. When a proxy
card is returned properly signed and dated, the shares represented thereby will
be voted in accordance with the instructions on the proxy card. Shareholders are
urged to mark the boxes on the proxy card to indicate how their shares are to be
voted. If no choices are specified, the shares represented by that proxy card
will be voted as recommended by the Board of Directors. However, if a
shareholder does not return a signed proxy card, his or her shares will not be
voted by the proxies. The proxy card, if properly executed and returned, also
confers discretionary authority on the proxies to vote the shares represented by
the proxy on any other matter that is properly presented for action at the
Annual Meeting. Any shareholder giving a proxy has the right to revoke it at any
time before it is exercised by giving notice in writing to the Secretary of the
Company, by delivering a duly executed proxy bearing a later date to the
Secretary prior to the Annual Meeting of Shareholders, or by attending the
Annual Meeting and voting in person. Attendance at the annual meeting will not
in and of itself constitute revocation of a proxy.
The Company will bear the costs of soliciting proxies. In addition to the
solicitation of proxies by use of the mails, some of the officers, directors and
other employees of the Company may also solicit proxies personally or by mail,
telephone or telegraph, but they will not receive additional compensation for
such services. Brokerage firms, custodians, banks, trustees, nominees or other
fiduciaries holding shares of Common Stock in their names will be reimbursed for
their reasonable out-of-pocket expenses in forwarding proxy material to their
principals.
VII. Deadline for Submission of Shareholders Proposals or Board Nominations
The By-Laws provide that if a shareholder intends to nominate a candidate
for election as a director, or bring other business before the Annual Meeting,
the shareholder must deliver written notice of his or her intention to the
Secretary of the Company (or if notice is mailed, it must be received by the
Secretary) not less than 120 calendar days in advance of the date in the then
current year corresponding to the date the Company's Proxy Statement was
released to shareholders in connection with the previous year's annual meeting.
If the date of the annual meeting has been changed by more than 30 days, the
notice must be received a reasonable time before such new date. The notice must
state the shareholder's name, address, and number of Class A or Class B shares
held, and fully describe the business to be brought before the meeting.
18
<PAGE>
In addition, if requested by the Company, the notice must also include all other
information that would be required to be filed with the Securities and Exchange
Commission, if with respect to the proposed business, the shareholder was a
participant in a solicitation subject to Section 14 of the Securities Exchange
Act of 1934. If the notice pertains to the nomination of a candidate for
election as a director, it must include the consent of the nominee to serve as a
director of the Company if elected.
Proposals of shareholders intended to be presented at the 1998 Annual
Meeting must be received by the Secretary of the Company (at the address listed
at the beginning of this Statement) no later than April 10, 1998.
VIII. Other Matters
At the date of this Proxy Statement, the Board of Directors does not know
of any other matter to come before the meeting other than the matters set forth
in the Notice of Meeting. However, if any other matter, not now known, properly
comes before the meeting, the persons named in the enclosed proxies will vote
said proxies in accordance with their best judgment on such matter. Shares
represented by any proxy will be voted with respect to the proposal outlined
above in accordance with the choice specified therein or in favor of any
proposal as to which no choice is specified.
The Annual Report to shareholders was mailed together with this Proxy
Statement to shareholders beginning August 8, 1997.
The Company will provide, without charge, a copy of its Report to the
Securities and Exchange Commission on Form 10-K for fiscal 1997, including the
financial statements and the schedules thereto. All such requests should be
directed to Josephine A. Bacchi, Secretary, John Wiley & Sons, Inc., 605 Third
Avenue, New York, New York 10158.
It is important that the accompanying proxies be returned promptly.
Therefore, whether or not you plan to attend the Annual Meeting in person, you
are requested to date, sign and return your proxies in the enclosed envelope to
which no postage need be affixed if mailed in the United States. The proxies may
be revoked at any time by you before they are exercised. If you attend the
meeting in person, you may withdraw any proxy and vote your own shares.
BY ORDER OF THE BOARD OF DIRECTORS
JOSEPHINE A. BACCHI
Secretary
New York, New York
August 8, 1997
19
