<PAGE>
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES EXCHANGE ACT OF 1934
(AMENDMENT NO. )
Filed by the Registrant [_]
Filed by a Party other than the Registrant [X]
Check the appropriate box:
[X] Preliminary Proxy Statement [_] CONFIDENTIAL, FOR USE OF THE
COMMISSION ONLY (AS PERMITTED BY
[_] Definitive Proxy Statement RULE 14A-6(E)(2))
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to (S)240.14a-11(c) or (S)240.14a-12
Bethlehem Steel Corporation
------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
R. R. Donnelley & Sons Company
------------------------------------------------------------------------
(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), 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.
[X] 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: $125.00
(2) Form, Schedule or Registration Statement No.: PRE 14A, 001-01941
(3) Filing Party:
(4) Date Filed: 02/22/95
Notes:
<PAGE>
Bethlehem
Steel
Corporation
- --------------------------------------------------------------------------------
[LOGO OF BETHLEHEM STEEL
CORPORATION APPEARS HERE]
Notice of 1995
Annual Meeting
of Stockholders
and Proxy Statement
<PAGE>
[C. H. Barnette's Letterhead]
March 15, 1995
To All Bethlehem Stockholders:
It is a pleasure to invite you to the Annual Meeting of Stockholders which
will be held in Wilmington, Delaware on Tuesday, April 25, 1995. We will meet in
the Gold Ballroom of the Hotel du Pont at 11 a.m. Your continuing interest in
Bethlehem's business is appreciated, and I hope that as many of you as possible
will attend the Meeting in person.
The annual election of directors will take place at the Meeting. Personal
information about each nominee for the Board of Directors as well as information
about the functions of the Board and its committees is contained in the Proxy
Statement. All nominees have previously been elected by the stockholders.
Herman E. Collier, Jr. and William C. Hittinger will retire as directors in
April of 1995. We acknowledge and thank them for their outstanding and loyal
service to Bethlehem.
The Board of Directors believes that it is advisable to increase the number
of authorized shares of Common Stock from 150,000,000 to 250,000,000 shares. The
Board recommends the increase in order to ensure that Bethlehem has sufficient
shares of authorized but unissued common stock to provide flexibility for
raising additional capital, possible acquisitions, providing appropriate
incentives to employees and other appropriate corporate purposes.
You are also being asked to ratify the appointment of Price Waterhouse LLP
as Bethlehem's independent auditors for 1995.
Please read the formal notice of the Annual Meeting and the Proxy Statement
carefully. For those of you who cannot be present at the Meeting, I urge you to
participate by completing, signing and returning your proxy in the enclosed
envelope. Your vote is important, and the management of Bethlehem appreciates
the cooperation of stockholders in directing proxies to vote at the Meeting.
Sincerely,
Curtis H. Barnette,
Chairman
<PAGE>
BETHLEHEM STEEL CORPORATION
1170 Eighth Avenue
Bethlehem, Pennsylvania 18016-7699
[LOGO OF BETHLEHEM STEEL CORPORATION APPEARS HERE]
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
The Annual Meeting of Stockholders of Bethlehem Steel Corporation
("Bethlehem") will be held in the Gold Ballroom, Hotel du Pont, Eleventh and
Market Streets, Wilmington, Delaware, on Tuesday, April 25, 1995, at 11 a.m.,
for the following purposes:
(1) To elect fourteen Directors to serve for terms of one year and until
their successors have been elected and qualified;
(2) To take action upon a proposal to amend Article Fourth of the Second
Restated Certificate of Incorporation of Bethlehem to increase the number of
authorized shares of Common Stock from 150,000,000 to 250,000,000;
(3) To ratify the appointment of Price Waterhouse LLP as the independent
auditors for 1995; and
(4) To transact such other business as may properly come before the
Meeting.
Stockholders of record at the close of business on March 6, 1995 are
entitled to receive notice of and to vote at the Meeting. A complete list of
such stockholders will be open for examination by any stockholder for any
purpose germane to the Meeting at the offices of The Corporation Trust Company
at 1209 Orange Street, Wilmington, Delaware, for a period of ten days prior to
the Meeting.
This Notice, the Proxy Statement and the enclosed form of proxy are sent to
you by order of the Board of Directors.
Secretary
March 15, 1995
- --------------------------------------------------------------------------------
If you do not expect to attend the Meeting, please mark, date and sign the
enclosed form of proxy and mail it promptly in the enclosed return envelope.
- --------------------------------------------------------------------------------
<PAGE>
BETHLEHEM STEEL CORPORATION
BETHLEHEM, PENNSYLVANIA 18016-7699
Table of Contents
General Information for Stockholders ..............................
Proxy Procedure ..............................................
Stockholder Proposals ........................................
Election of Directors .............................................
General Background ...........................................
Information Concerning Nominees ..............................
Amount and Nature of Beneficial Ownership ....................
Committees of the Board ......................................
Amendment of Article Fourth of the Second Restated Certificate
of Incorporation of Bethlehem to Increase the Number of
Authorized Shares of Common Stock ...............................
Ratification of the Appointment of Independent Auditors ...........
Executive Compensation ............................................
Compensation Committee Report on Executive Compensation ......
Summary Compensation Table ...................................
Stock Option/SAR Grants in 1994 ..............................
Aggregated Stock Option/SAR Exercises in 1994
and 12/31/94 Stock Option Values ...........................
Pension Plan Table ...........................................
Comparative Stock Performance ................................
Additional Information ............................................
Indemnification Assurance Agreements .........................
Stockholders .................................................
Other Matters ................................................
Exhibit A -- Proposed Revised Form of First Paragraph of Article Fourth of
Bethlehem's Second Restated Certificate of Incorporation
<PAGE>
PROXY STATEMENT
This Proxy Statement is furnished in connection with the solicitation by
the Board of Directors of Bethlehem Steel Corporation ("Bethlehem") of proxies
for use at the Annual Meeting of Stockholders to be held on April 25, 1995, and
any adjournments thereof. This Proxy Statement and the accompanying form of
proxy are being mailed to stockholders on or after March 15, 1995.
GENERAL INFORMATION FOR STOCKHOLDERS
Proxy Procedure
Proxies are solicited by the Board of Directors of Bethlehem in order to
provide every stockholder with an opportunity to vote on all matters that
properly come before the Annual Meeting of Stockholders, whether or not the
stockholder attends in person. When the enclosed form of proxy is properly
signed, dated and returned, the shares represented will be voted by the persons
named as proxies in accordance with the stockholder's directions. If no
direction is indicated, the shares will be voted as recommended by the Board of
Directors.
Bethlehem has adopted a confidential voting policy which provides that
votes of all stockholders of Bethlehem shall be held in confidence from
Bethlehem, its directors, officers and employees except (i) to allow the
independent inspectors of election to certify the results of the vote; (ii) as
necessary to meet applicable legal requirements and to assert or defend claims
for or against Bethlehem; (iii) in case of a contested proxy solicitation; or
(iv) in the event a stockholder has made a written comment on the proxy
material. As part of the policy, Bethlehem will continue its current practice
of employing an independent tabulator to receive and tabulate the proxies and
independent inspectors of election.
Any stockholder executing a form of proxy may revoke that proxy or may
submit a revised form of proxy at any time before it is voted. A stockholder
may also vote by ballot at the Annual Meeting, thereby canceling any proxy
previously returned. Stockholders wishing to name as their proxy someone other
than those designated in the form of proxy may do so by crossing out the names
of the proxies appearing thereon and inserting the name(s) of the person(s) they
wish to have act as proxy. In such a case, it will be necessary that the form
of proxy be delivered by the stockholder to the person(s) named and that the
person(s) named be present and vote at the Annual Meeting. Any proxy form on
which alternate proxies have been named should not be mailed directly to
Bethlehem.
Votes cast at the Annual Meeting will be tabulated by the persons appointed
as the independent inspectors of election for the Annual Meeting. The
inspectors of election will treat shares of Common Stock and of ESOP Preference
Stock represented by a properly signed and returned proxy as present at the
Annual Meeting for purposes of determining a quorum, without regard to whether
the proxy is marked as casting a vote or abstaining. Likewise, the inspectors
of election will treat shares of Common Stock and of ESOP Preference Stock
represented by "broker non-votes" as present for purposes of determining a
quorum.
The nominees for election to the Board of Directors receiving the greatest
number of the affirmative votes cast by holders of Common Stock and of ESOP
Preference Stock, up to the number of directors to be elected, will be elected
as directors. Accordingly, so long as a quorum is present, abstentions or
broker non-votes as to the election of directors will have no effect on the
election of directors.
The affirmative vote of (i) the holders of a majority of the outstanding
shares of Common Stock, voting separately as a class, and (ii) the holders of a
majority of the outstanding shares of Common Stock and of ESOP Preference Stock,
voting together as a single class, is required to approve the increase in the
number of authorized shares of Common Stock. Therefore, abstentions and broker
non-votes will have the same effect as votes against this proposal.
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<PAGE>
The affirmative vote of the holders of a majority of the shares of Common
Stock and of ESOP Preference Stock that are present in person or by proxy and
entitled to vote at the Annual Meeting, voting together as a single class, is
required to ratify the appointment of the independent auditors. Therefore,
abstentions will have the same effect as votes against this proposal. Broker
non-votes as to such proposal, however, will be deemed shares not entitled to
vote on such proposal and will not count as votes for or against such proposal.
Stockholder Proposals
Stockholders may be asked to consider and take action on proposals
submitted by stockholders who are not members of management or the Board of
Directors. Proposals by stockholders may be included in the Proxy Statement if
the proposals are proper subjects for inclusion, are submitted to Bethlehem on a
timely basis, and otherwise comply with Rule 14a-8 under Section 14(a) of the
Securities Exchange Act of 1934 and the laws of the State of Delaware. Each
proposal submitted should include the full and correct registered name and
address of the stockholder(s) making the proposal, the number of shares owned
and the dates of acquisition thereof. If beneficial ownership is claimed, proof
thereof should be submitted with the proposal. In addition, proponents must
appear personally or by proxy at the Annual Meeting to present the proposal for
action. In order for such proposals to be included for the Annual Meeting of
Stockholders to be held in 1996, they must be received by Bethlehem on or before
November 13, 1995.
The Board of Directors carefully considers all proposals and suggestions
submitted by stockholders to determine if they are in the best interests of
Bethlehem and the stockholders generally. When a stockholder presents, as a
formal resolution, a suggestion which is practicable, and in the best interests
of Bethlehem and its stockholders, and which can be implemented by management
and the Board without the necessity of stockholder approval, the suggestion is
usually adopted without stockholder approval and the proponent withdraws the
resolution.
ELECTION OF DIRECTORS
General Background
As provided by the laws of Delaware, Bethlehem's state of incorporation,
the business and affairs of Bethlehem are managed by or under the direction of
the Board of Directors of Bethlehem, which is currently comprised of sixteen
members. The Board of Directors represents the interests of the stockholders as
a whole and has responsibility for the overall performance of Bethlehem.
Stockholders annually elect directors in April of each year to serve for terms
of one year and until their successors have been elected and qualified. This
annual election of directors is one of the important purposes of the Annual
Meeting.
Members of the Board are kept informed of Bethlehem's business by
presentations made at Board meetings and by various reports sent to them by
management. The Board of Directors meets regularly and met nine times during
1994. Directors also meet in committees of the Board, and information
concerning the committees can be found beginning on page ___ of this Proxy
Statement. During 1994, the average attendance of directors at Board meetings
and meetings of committees to which they belonged was approximately 96%.
Of the fourteen directors standing for election, eleven are not employees
of Bethlehem. These eleven non-employee Board members bring valuable experience
to Bethlehem from a variety of fields. None of them has carried on an
occupation or employment with any subsidiary or other affiliate of Bethlehem.
Each non-employee director receives cash compensation of $22,000 annually
for his service as a Bethlehem director. This annual retainer fee includes
compensation for service as a member of the Audit Committee, the Compensation
Committee, the Finance Committee and the Committee on Directors. In
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<PAGE>
addition, each non-employee director who serves as Chairman of the Audit
Committee, the Committee on Directors or the Compensation Committee receives
additional compensation of $2,500 annually for service as such Committee
Chairman. Each non-employee director also receives an attendance fee of $1,000
for the Annual Meeting of Stockholders, any regular or special board of
directors' meeting, any committee meetings or meetings held on a day other than
a day on which a board meeting is held, and any special meeting attended at the
request of the Chairman and held on a day other than a day on which a board or
committee meeting is held. Each non-employee director of Bethlehem also
receives on December 1 of each year an annual award of 500 shares of Bethlehem
Common Stock pursuant to the 1994 Non-Employee Directors Stock Plan, which was
approved by stockholders at last year's Annual Meeting. Non-employee directors
are also reimbursed for any expenses which may be incurred by them in connection
with the business and affairs of Bethlehem. None of the directors who are
employees of Bethlehem are compensated separately for service as a member of the
Board of Directors or any committee of the Board.
Under the Post Retirement Retainer Plan, directors who are not and have not
been employees of Bethlehem or its subsidiaries and who retire from the Board
with ten or more years of service, will receive annual payments equal to 100% of
the annual retainer fee payable at retirement. Directors who retire with
between five and ten years of service will receive annual payments starting at
50% of the annual retainer fee payable at retirement for directors with five
years of service and increasing 10% for each year of service up to ten years.
The annual payments will begin at retirement (or at age 65 if retirement is
prior to age 65) and will continue for a period equal to the director's years of
service with the Board. In the event of the death of a director, any unpaid
amount will be paid to the director's designated beneficiary or the director's
estate if there is no designated beneficiary.
The general retirement policy of the Board provides that non-employee
directors shall retire at the end of their term as a director during which they
reach age 70, except that non-employee directors who were elected at the 1991
Annual Meeting of Stockholders (all current non-employee directors except
Messrs. Civiletti, Clark, Kaden and Kamen) shall retire at the end of their term
as a director during which they reach age 72. Employee directors shall retire
from the Board at the time of their retirement from Bethlehem. The present
retirement age for management employees of Bethlehem is 65.
Pursuant to the terms of a 1993 labor agreement with the United
Steelworkers of America ("USWA"), the USWA has the right to designate a nominee
for consideration by the Committee on Directors and the Board of Directors for
one seat on the Board. The nominee is to be a prominent individual with
experience in public service, labor, education or business. The nominee shall
not be or become, while serving as a director, an officer, employee or director
of the USWA. Subject to complying with the same standards of conduct as every
other Bethlehem director, and subject to annual election by the stockholders,
the USWA nominee will serve as a director during the term of the 1993 labor
agreement, which terminates July 31, 1999. Mr. Kaden was designated by the USWA
for consideration as a director of Bethlehem by the Committee on Directors. The
Committee on Directors recommended Mr. Kaden's election to the Board, the Board
elected Mr. Kaden a director in March 1994, and the stockholders elected Mr.
Kaden a director at the 1994 Annual Meeting of Stockholders.
The fourteen nominees whose biographies appear on the following pages have
been recommended by the Committee on Directors and proposed by the entire Board
of Directors. They have been recommended on the basis of their demonstrated
broad knowledge, experience and ability in their respective endeavors, and, most
importantly, on the basis of their ability to represent the interests of all
stockholders, rather than the special interests of a particular group.
Information Concerning Nominees
The persons named in the accompanying form of proxy intend to vote the
shares covered by proxies for the election of the director nominees named below.
Each nominee is presently a director of Bethlehem and has previously been
elected a director by the stockholders. If any nominee shall, prior to the
Annual Meeting, become unavailable for election as a director, which is not
expected, the persons named in the accompanying form of proxy will vote for such
substitute nominee, if any, as may be recommended by the Board of Directors.
Directors elected at the Meeting will hold office until the next
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<PAGE>
Annual Meeting of Stockholders and until their successors have been elected and
qualified, or until their earlier resignation, retirement or removal.
Curtis H. Barnette Mr. Barnette, age 60, has been a director of Bethlehem
since 1986. He was elected Chairman and Chief Executive
Officer, effective November 1, 1992. He has been an
employee of Bethlehem since 1967, holding various
positions. Prior to his election as Chairman and Chief
Executive Officer, Mr. Barnette had been Secretary of
Bethlehem since 1976, General Counsel since 1977, Vice
President, Law from 1977 to 1985, and Senior Vice
President since 1985. Mr. Barnette is also a director
of Metropolitan Life Insurance Company.
Benjamin R. Civiletti Mr. Civiletti, age 59, was elected a director of
Bethlehem in March 1993. He has been Chairman of
Venable, Baetjer and Howard, a law firm, since July
1993, and a partner since 1981. He had been Managing
Partner of that firm from 1987 until 1993. He
previously served as Attorney General of the United
States from 1979 to 1981. Mr. Civiletti is also a
director of MBNA America Bank, N.A., MBNA International
Bank Limited and Wackenhut Corrections Corporation.
Worley H. Clark Mr. Clark, age 62, was elected a director of Bethlehem
in March 1993. He retired as Chairman and Chief
Executive Officer of Nalco Chemical Company, a
manufacturer of specialty chemicals, in June 1994,
having held those positions since 1984 and having been
an employee of that company since 1960. Mr. Clark is
also a director of NICOR Inc., USG Corporation,
Northern Trust Company, James River Corporation and
Diamond Shamrock Corporation.
John B. Curcio Mr. Curcio, age 60, was elected a director of Bethlehem
in 1988. He was Chief Executive Officer and a director
of Mack Trucks, Inc., a manufacturer of heavy-duty
trucks, from 1983 until 1989, and Chairman of the Board
from 1985 until his retirement. Mr. Curcio is also a
director of Minerals Technologies, Inc. and Integrated
Components Systems, Inc. and Vice Chairman of Jupiter
Logistics, USA, Inc. and Jupiter Logistics, de Mexico,
SA de C.V.
Thomas L. Holton Mr. Holton, age 69, was elected a director of Bethlehem
in 1987. He retired from Peat, Marwick, Mitchell & Co.,
an accounting firm, in 1986 after twenty-eight years as
a partner. He served as Chairman and Chief Executive
Officer of Peat, Marwick, Mitchell & Co. (U.S.) from
1979 until 1984, and as Chairman of Peat Marwick
International from 1983 to 1985. Mr. Holton is also a
member of the Advisory Board of Potomac Investment
Associates.
Lewis B. Kaden Mr. Kaden, age 52, was elected a director of Bethlehem
in March 1994. He has been a partner of Davis Polk &
Wardwell, a law firm, and an Adjunct Professor of Law
at Columbia University since 1984, where he was a
Professor of Law from 1976 to 1984.
Harry P. Kamen Mr. Kamen, age 61, was elected a director of Bethlehem
in 1993. He has been Chairman of the Board and Chief
Executive Officer of Metropolitan Life Insurance
Company, a mutual life insurance company, since April
1993. He has been an employee of Metropolitan since
1959, holding various positions. Prior to his election
as Chairman of the Board and
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Chief Executive Officer, Mr. Kamen had been serving as
Senior Executive Vice President since October 1991,
Executive Vice President from January to September
1991, Executive Vice President and General Counsel from
April 1989 to December 1990 and Senior Vice President
and General Counsel from January 1987 to March 1989.
Mr. Kamen is also a director of Banco Santander.
Winthrop Knowlton Mr. Knowlton, age 64, was elected a director of
Bethlehem in 1986. He is Chairman of Knowlton Brothers,
Inc., an investment firm. From 1982 to 1987, he was the
director of the Center for Business and Government at
the John F. Kennedy School of Government, Harvard
University, as well as the Henry R. Luce Professor of
Ethics, Business and Public Policy. Mr. Knowlton was
Chairman of the Board of Harper & Row Publishers, Inc.,
a book publisher, from 1979 to 1986 and served as Chief
Executive Officer of that company from 1970 through
1981. Mr. Knowlton is also a director of Equitable Life
Assurance Society of the United States.
Robert McClements, Jr. Mr. McClements, age 66, was elected a director of
Bethlehem in 1989. He retired in May 1992 as Chairman
of the Board and a director of Sun Company, Inc., a
diversified energy company, positions he held since
1987 and 1979, respectively. Mr. McClements also served
as Chief Executive Officer of that company from 1985
until September 1991. Mr. McClements is also a director
of Unisys Corporation.
Gary L. Millenbruch Mr. Millenbruch, age 57, was elected a director of
Bethlehem in 1991. Mr. Millenbruch was elected
Executive Vice President and Chief Financial Officer,
effective November 1, 1992, and Treasurer, effective
September 1, 1994. He has been an employee of Bethlehem
since 1959, holding various positions. Prior to his
election as Executive Vice President and Chief
Financial Officer, he had been Senior Vice President
and Chief Financial Officer since 1986.
Roger P. Penny Mr. Penny, age 58, was elected a director of Bethlehem
in 1991. Mr. Penny was elected President and Chief
Operating Officer, effective November 1, 1992. He has
been an employee of Bethlehem since 1958, holding
various positions. Prior to his election as President
and Chief Operating Officer, Mr. Penny had been Senior
Vice President, Steel Operations since 1987.
Dean P. Phypers Mr. Phypers, age 66, was elected a director of
Bethlehem in 1986. He was a Senior Vice President and a
director of International Business Machines
Corporation, an information technology and computer
company, from 1979 and 1982, respectively, until 1987.
Mr. Phypers is also a director of American
International Group, Inc., Church & Dwight Co., Inc.
and Cambrex Corp.
William A. Pogue Mr. Pogue, age 67, was elected a director of Bethlehem
in 1988. He retired in 1989 as Chairman of the Board,
President and Chief Executive Officer of CBI
Industries, Inc., a manufacturer of storage tanks and
industrial gases, positions he had held since 1982 and
as a director of that company, a position he had held
since 1972. Mr. Pogue is also a director of Nalco
Chemical Co. and Amerada Hess Corporation.
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<PAGE>
John F. Ruffle Mr. Ruffle, age 57, was elected a director of Bethlehem
in 1990. He retired in June 1993 as Vice Chairman of
the Board of J. P. Morgan & Co. Incorporated, a bank
holding company, and Morgan Guaranty Trust Co. of New
York, a commercial bank, positions he held since 1985.
Mr. Ruffle is also a director of JPM Advisor Fund,
Student Loan Marketing Association (Sallie Mae) and
Trident Corporation.
In addition to the business activities described above, the director
nominees also participate in various other business, professional and charitable
activities.
Amount and Nature of Beneficial Ownership
The following table shows the shares of Bethlehem Common Stock beneficially
owned, directly or indirectly, by each current director, Messrs. Jordan and Post
and all directors and executive officers as a group at March 6, 1995:
<TABLE>
<CAPTION>
Shares of Shares Subject
Common Stock to Acquisition
Owned Directly Within 60 Percent
Name or Indirectly /1/ Days /2/ Total of Class /3/
- ----------------- ----------------- ----------------- --------- -----------
<S> <C> <C> <C> <C>
Curtis H. Barnette 95,774 122,000 217,774 /4/
Benjamin R. Civiletti 700 -- 700 /4/
Worley H. Clark 2,500 -- 2,500 /4/
Herman E. Collier, Jr./5/ 1,600 -- 1,600 /4/
John B. Curcio 1,500 -- 1,500 /4/
William C. Hittinger/5/ 1,500 -- 1,500 /4/
Thomas L. Holton 1,700 -- 1,700 /4/
Lewis B. Kaden 1,500 -- 1,500 /4/
Harry P. Kamen 1,500 -- 1,500 /4/
Winthrop Knowlton 1,600 -- 1,600 /4/
Robert McClements, Jr. 1,500 -- 1,500 /4/
Gary L. Millenbruch 62,031 101,000 163,031 /4/
Roger P. Penny 55,446 101,000 156,446 /4/
Dean P. Phypers 1,500 -- 1,500 /4/
William A. Pogue 2,000 -- 2,000 /4/
John F. Ruffle 1,500 -- 1,500 /4/
John A. Jordan, Jr. 40,113 9,500 49,613 /4/
David P. Post 23,248 38,600 61,848 /4/
- -------------
30 directors and executive
officers as a group (includ-
ing those named above) 452,945/6/ 577,251 1,030,196/6/ /4/
</TABLE>
- -----------------------
1. The figures shown include shares allocated as of March 6, 1995, to the
accounts of participants under the Savings Plan for certain salaried employees
of Bethlehem and its subsidiaries.
Shares of Bethlehem Common Stock acquired by the Trustee, State Street Bank
and Trust Company, for purposes of the Savings Plan are allocated to the
accounts of participants as of the end of each month. Participants are entitled
to provide instructions as to the voting of the shares allocated to their
accounts. Shares not allocated to participants' accounts and shares credited to
the accounts of participants who do not provide voting instructions are voted in
accordance with instructions of the Savings Plan Committee.
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2. The Securities and Exchange Commission deems a person to have
beneficial ownership of all shares which that person has the right to acquire
within 60 days. The shares indicated represent stock options granted under the
1984 Stock Option Plan and the 1988 and 1994 Stock Incentive Plans of Bethlehem
and held by the particular individual or group.
3. Based upon ____________ total outstanding shares of Common Stock on
March 6, 1995.
4. The number of shares deemed to be owned by each director or executive
officer and all directors and executive officers as a group represents less than
1% of the outstanding shares.
5. Messrs. Collier and Hittinger will retire as directors in April of
1995.
6. The figures shown include an aggregate of 1,314 shares held by, or for
the benefit of, the immediate families or other relatives of all directors and
executive officers as a group. Directors and executive officers disclaim
beneficial ownership of all of these shares.
- ---------------------------
None of the directors or executive officers of Bethlehem own any shares of
Bethlehem's Preferred Stock or ESOP Preference Stock.
Bethlehem is required to identify any director or officer who failed to
timely file with the Securities and Exchange Commission a required report
relating to transactions in Bethlehem's equity securities. An officer of
Bethlehem, Mr. Joseph F. Emig, filed one late report reflecting the prior
ownership of 22 shares of Bethlehem Common Stock held in a brokerage
account.
Committees of the Board
Bethlehem's Board of Directors has established committees to assist it in
the discharge of its responsibilities. The principal committees, their current
members and the principal responsibilities of each are described below.
The Executive Committee is presently comprised of Messrs. Barnette
(Chairman), Millenbruch and Penny. The Executive Committee serves as a policy-
making and supervisory body for all operations of Bethlehem. It has all the
delegable powers of the Board of Directors between meetings of the Board. The
Committee meets at appropriate times and met two times during 1994.
The Finance Committee is presently comprised of Messrs. Barnette
(Chairman), Civiletti, Clark, Collier, Curcio, Hittinger, Holton, Kaden, Kamen,
Knowlton, McClements, Millenbruch, Penny, Phypers, Pogue and Ruffle. The
Finance Committee has the authority to advise and consult with respect to all
activities, plans and policies affecting the financial affairs of Bethlehem,
including dividends. The Finance Committee meets at appropriate times and met
eight times during 1994.
The Audit Committee is presently comprised of Messrs. Holton (Chairman),
Civiletti, Clark, Collier, Kaden, Kamen and Ruffle. The Audit Committee is
responsible for making recommendations to the Board of Directors as to the
independent auditors of Bethlehem and subsidiaries to be designated and
appointed by the Board of Directors, for reviewing with the independent auditors
the scope of their examination of the financial statements of Bethlehem, for
meeting with representatives of the independent auditors to review and consider
questions relating to their examination and any other report submitted, for
reviewing generally with the independent auditors and internal auditors the
internal accounting controls and auditing procedures of Bethlehem and for
reviewing other professional services performed for Bethlehem by the independent
auditors. From time to time, the Audit Committee meets with the independent
auditors and Bethlehem's internal auditors without members of Bethlehem's
management being present. The Audit Committee meets at appropriate times and
met four times during 1994.
The Compensation Committee is presently comprised of Messrs. Pogue
(Chairman), Curcio, Hittinger, Knowlton, McClements and Phypers. The
Compensation Committee is responsible for administering Bethlehem's executive
compensation programs and for determining the compensation of Bethlehem's
executive officers. The members of the Committee do not participate in the
executive compensation programs the Committee administers. The Committee's
report on executive compensation can be found beginning on page ___ of this
Proxy Statement. The Compensation Committee meets at appropriate times and met
five times during 1994.
7
<PAGE>
The Committee on Directors is presently comprised of Messrs. Phypers
(Chairman), Civiletti, Clark, Collier, Curcio, Hittinger, Holton, Kaden, Kamen,
Knowlton, McClements, Pogue and Ruffle. The Committee on Directors has the
authority to search for persons qualified to be members of the Board and to make
recommendations with respect thereto to the Board, to review and evaluate
members of the Board, the Committees of the Board, and procedures and policies
of the Board and to review and evaluate the performance of the Corporation and
the management thereof. The Committee is also responsible for management
evaluation and succession review. If any stockholder wishes to recommend a
nominee for membership on the Board of Directors, he should write to the
Secretary of Bethlehem specifying the name of the nominee and the qualifications
of such nominee for membership on the Board of Directors. Each submission must
include the written consent of the person proposed for nomination indicating
that the person is willing and able to serve as a director of Bethlehem. All
such recommendations will be brought to the attention of the Committee on
Directors. The Committee on Directors meets at appropriate times and met four
times during 1994.
AMENDMENT OF ARTICLE FOURTH OF THE
SECOND RESTATED CERTIFICATE OF INCORPORATION OF BETHLEHEM
TO INCREASE THE NUMBER OF AUTHORIZED SHARES OF COMMON STOCK
Another purpose of the Meeting is to take action upon a proposed amendment
of Article Fourth of the Second Restated Certificate of Incorporation. The
Board of Directors has unanimously approved an increase in the number of
authorized shares of common stock $1 par value per share ("Common Stock") from
150,000,000 to 250,000,000 shares.
As of March 6, 1995, there were 109,8xx,xxx shares of Common Stock issued
and outstanding and 1,996,715 shares held in Bethlehem's treasury.
Approximately 30,000,000 additional shares of Common Stock were reserved for
issuance upon conversion into Common Stock of Bethlehem's outstanding series of
Preferred and Preference Stock and in connection with Bethlehem's stock
incentive and other employee benefit plans. This left a balance of
approximately 13,xxx,xxx authorized but unissued shares and treasury shares
available and unreserved for future use.
The Board of Directors believes Bethlehem's ability to meet business
requirements and to take advantage of financial opportunities would be enhanced
substantially if the proposed increase in authorized shares is approved. The
additional shares of Common Stock could be used to meet any proper corporate
purpose, including, without limitation, raising of additional capital,
acquisitions, issuance pursuant to stock option or other employee benefit or
incentive compensation plans, and availability upon conversion of debt or equity
securities. No stockholder of Bethlehem has or, as a result of the proposed
amendment, would have any preemptive right to subscribe for, purchase or
otherwise acquire any stock of Bethlehem. Accordingly, if the proposed
amendment is approved, a substantial amount of Common Stock would be available
for issuance to any entity which might wish to make an investment in Bethlehem
on terms deemed by the Board of Directors to be in the best interests of
Bethlehem and its stockholders. There currently are no plans for or
negotiations relating to any such investment.
While not the intent of the Board of Directors, approval of the proposed
amendment could have the effect of discouraging a takeover attempt in that
Bethlehem's Board could consider issuing the additional shares of Common Stock
to impede any unsolicited bid for control of Bethlehem which the Board believed
was not in the best interests of Bethlehem and its stockholders. Availability
as a defensive response to a takeover attempt was not a motivating factor in the
Board's approval of the proposed amendment. No takeover bid has been proposed
to or discussed with Bethlehem and, to Bethlehem's best knowledge, no such bid
is under consideration.
If the proposed amendment is approved, the Board of Directors could
authorize the issuance of additional shares (up to the new maximum number of
authorized shares) for any proper purpose without further stockholder approval,
unless otherwise required by applicable law or by the rules of the New York
8
<PAGE>
Stock Exchange or any other stock exchange on which Bethlehem's securities are
listed. Bethlehem does not have any current plans to issue any additional shares
of Common Stock (other than as may be necessary or appropriate in connection
with existing employee benefit plans or upon conversion of outstanding shares of
Preferred and Preference Stock). However, the Board of Directors believes that
if authorization of any increase in the Common Stock were postponed until a
specific need arose, the delay and expense incident to obtaining the approval of
stockholders at that time could significantly impair Bethlehem's ability to meet
its financing or other objectives.
The additional shares of Common Stock for which authorization is sought
would be identical to the shares of Common Stock now authorized. The
authorization of additional shares of Common Stock would not have any effect on
the rights of existing security holders. However, issuance of additional shares
of Common Stock would dilute the voting rights of present holders of Common
Stock. In addition, depending upon the consideration received for the issuance
of any additional shares of Common Stock and other relevant facts and
circumstances, it is possible that issuance of such Common Stock could have a
dilutive effect on the stockholders' equity and earnings per share attributable
to such present holders.
The affirmative vote of (i) the holders of a majority of the outstanding
shares of Common Stock, voting separately as a class, and (ii) the holders of a
majority of the outstanding shares of Common Stock and of ESOP Preference Stock,
voting together as a single class, is required for approval of this amendment.
The first paragraph of Article Fourth of the Second Restated Certificate of
Incorporation, including the changes effected by the proposed amendment to
increase the number of authorized shares of Common Stock, will be substantially
in the form set forth in Exhibit A attached to this Proxy Statement.
The Board of Directors recommends that stockholders vote FOR the
proposed amendment of Article Fourth to increase the number of
authorized shares of Common Stock.
RATIFICATION OF THE APPOINTMENT OF INDEPENDENT AUDITORS
The Board of Directors, on the recommendation of the Audit Committee, has
appointed the firm of Price Waterhouse LLP ("Price Waterhouse") as independent
auditors to examine the financial statements of Bethlehem and its consolidated
subsidiaries for the year 1995.
Price Waterhouse is a member of the SEC Practice Section of the American
Institute of Certified Public Accountants and has submitted a copy of their peer
review results to the Audit Committee. The peer review consists of a review and
evaluation of the quality of a firm's accounting and auditing services by
partners and managers from another CPA firm or from several CPA firms.
Price Waterhouse states that no partner or professional employee of that
firm has any direct financial interest or any material indirect financial
interest in Bethlehem or in any of its subsidiaries.
Representatives of Price Waterhouse are expected to be present at the
Annual Meeting of Stockholders with an opportunity to make a statement if they
desire to do so and to be available to respond to appropriate questions.
The affirmative vote of the holders of a majority of the shares of Common
Stock and of ESOP Preference Stock that are present in person or by proxy and
entitled to vote at the Annual Meeting, voting together as a single class, is
required for ratification of the appointment of the independent auditors.
The Board of Directors recommends that stockholders vote FOR ratification of the
appointment of the independent auditors.
9
<PAGE>
EXECUTIVE COMPENSATION
Compensation Committee Report on Executive Compensation
Bethlehem's executive compensation programs are designed to attract, retain
and motivate highly qualified executives to cause the best possible performance
from them. Compensation for Bethlehem's executives is based both on individual
performance, and upon corporate and business unit performance, and consists of
the following elements:
. Salaries that are determined by individual contribution and
performance, and that are competitive in the marketplace.
. Incentive compensation bonuses that, if paid, are directly linked to
corporate and business unit profitability.
. Long term stock incentives that are designed to align the interests of
the executives with those of the stockholders and to increase the long
term retention of key employees.
. A broad-based employee benefits program which includes a pension
program, a savings plan, group medical coverage and life insurance.
The Compensation Committee of the Board of Directors is responsible for
administering Bethlehem's executive compensation programs and for determining
the compensation of Bethlehem's executive officers. The Committee has available
to it extensive compensation surveys (primarily with respect to salaries, annual
incentive compensation and stock options), independent compensation consultants
and information about executive compensation within the steel industry and other
industry groups. The Committee is composed of directors who are not current or
retired employees of Bethlehem and who do not participate in the executive
compensation programs which the Committee administers.
Salaries. The Committee believes the salary of an executive must be based
primarily on the executive's level of responsibility and performance. In
addition, the Committee believes that salaries should be competitive with
executive salaries provided by other corporations in the steel business,
including the peer group of integrated steelmakers shown in the comparative
performance chart on page ___, and by other manufacturing companies of
comparable size and complexity. The Committee reviews both publicly available
information about the salaries paid to executive officers of other steel
companies and broad survey data from over 300 manufacturing, non-utility and
non-financial services companies to determine salary levels that compare to
those at companies with similar business performance, measured by such criteria
as revenue, return on assets and return on equity. Salary levels for
Bethlehem's executives are targeted at the median of such survey data for
companies with annual revenues of between $3 billion and $6 billion. Since
duties, responsibilities and experience of an executive officer may differ from
survey norms in both content and scope, adjustments are made by the Committee in
its judgment for those factors as well as for individual performance.
Consequently, some salaries are lower and some higher than survey medians. The
Committee conducts periodic reviews of executive officer salaries and makes
adjustments as warranted. The increase in the 1994 salaries of the executive
officers named in the Summary Compensation Table was based on individual
performance and the significant improvement in Bethlehem's financial results in
1993 compared to 1992. 1994 salary levels for these officers do not, in the
Committee's opinion, significantly deviate from survey medians described above.
Incentive Compensation Bonuses. The Committee believes that competitive
salaries should be supplemented by incentive compensation bonus awards which are
directly linked to performance-oriented goals as measured by Bethlehem's annual
business plan. The awards may be granted in cash, stock or a combination
thereof.
Incentive compensation bonus awards for executive officers are paid
pursuant to a profit sharing plan for essentially all salaried employees. Under
the plan, employees and executive officers have the
10
<PAGE>
opportunity to earn a targeted percentage of base salary which increases with
higher position levels, thereby placing a greater percentage of compensation at
risk for those with greater responsibility. For the chief executive officer and
the other four executive officers named in the Summary Compensation Table,
payment of incentive compensation under this program is based entirely on the
achievement of corporate profitability goals, and for 1994 was targeted at 50%
of base salary, not to exceed 100% of base salary. For other executive
officers, incentive payments are based in part on the achievement of corporate
profitability goals and in part on the achievement of business unit or
departmental profitability goals or cost objectives. For 1994, Mr. Barnette and
each of the other four officers named in the Summary Compensation Table received
an incentive compensation bonus award equal to approximately 22% of base salary
based on Bethlehem's 1994 net income.
Long Term Stock Incentives. The Committee believes that stock incentives
are an important element of Bethlehem's executive compensation program. They
align the interests of Bethlehem's executives with those of the stockholders and
increase the long-term retention of key employees. As discussed below, the
Committee has made stock option and restricted stock awards to executive
officers and other key employees under its stock incentive plans. Stockholders
approved the 1994 Stock Incentive Plan at the 1994 Annual Meeting of
Stockholders.
Executive officers and other key employees have received annual grants of
stock options under Bethlehem's stock incentive plans. The Committee believes
that stock options provide an incentive that focuses the executive's attention
on managing Bethlehem from the perspective of an owner with an equity stake in
the business. Options are awarded with an exercise price equal to the market
price of Common Stock on the date of grant and have a maximum term of ten years.
Options awarded in 1994 become exercisable for half of the option shares two
years from the date of grant and for the remaining half of the option shares
four years from the date of grant and were awarded in tandem with stock
appreciation rights. Executives are encouraged to hold the stock received
through the exercise of options and stock appreciation rights. In determining
the number of option shares to be awarded to an executive officer, the Committee
considers the performance of the individual and annual salary level. The
Committee, in its judgment, may adjust the number of shares based on a
comparison of option awards (using grant date value) of the survey companies
described under "Salaries". The Committee, in its judgment, may elect to reduce
the size of an award if an executive has disposed of shares received through any
previous exercise of options or stock appreciation rights. Applying these
factors, during 1994 the Committee awarded 301 key employees, including Mr.
Barnette and the other executive officers named in the table on page ___,
options to purchase Bethlehem Common Stock at a price of $20.375 per share (the
fair market value of Bethlehem Common Stock on the date of the award). The
awards to Mr. Barnette and the other named executive officers in the table on
page ___ are generally less than option awards at the survey companies.
The Committee has also implemented a Key Employee Stock Investment Award
Program under the 1994 Stock Incentive Plan which is designed to increase the
long-term retention of key employees, encourage their ownership of stock, and
align their interests with the interests of the stockholders. Under this
Program, executive officers and other key employees have been awarded restricted
shares of Common Stock which may not be sold, transferred or assigned while the
shares are restricted. Depending upon the age of the recipient at the time of
the award, unless otherwise determined by the Committee the restrictions on the
shares generally expire either (i) at the later of age 62 or retirement or (ii)
after five years as to one-half of the shares awarded and at the later of age 62
or retirement as to the remaining shares. The shares are forfeited if the
employee voluntarily leaves the employment of Bethlehem or is terminated for
cause before the restrictions expire. The size of restricted stock awards under
this Program is determined by the Committee in its judgment based on a number of
factors including level of responsibility, individual performance and potential
to make a contribution to Bethlehem's future success, overall corporate progress
toward achieving sustained profitability and the Committee's understanding of
restricted stock practice at other companies. The Committee assigns no specific
weight to any of these factors when making its determinations. In order to
retain and motivate Mr. Barnette and the other named executive officers and
further align their interests with those of the stockholders, the Committee
determined that it was appropriate to award each of them restricted shares of
Common Stock under the Key Employee Stock Investment Award Program in April
1994. Mr. Barnette was awarded 30,000 shares, Mr. Penny, 15,000 shares, Mr.
11
<PAGE>
Millenbruch, 15,000 shares, Mr. Jordan, 10,000 shares, and Mr. Post, 10,000
shares. The shares are restricted and may not be sold, transferred or assigned
until age 62. The shares will be forfeited if the recipients voluntarily leave
the employment of Bethlehem or are terminated for cause before the restrictions
expire. The size of the awards was based on the factors discussed above.
Compensation of Chief Executive Officer. In establishing Mr. Barnette's
salary for 1994, the Committee considered the salaries of chief executive
officers of other steel companies and companies of similar size and complexity,
Mr. Barnette's performance, and the significant improvement in Bethlehem's
financial results in 1993 compared to 1992 (a $234 million improvement excluding
restructuring charges and the cumulative effect of accounting changes). In
addition, a number of important goals were achieved during 1993, including the
decentralization of operations into separate business units better able to
respond rapidly to customer needs, the implementation of new long term labor
contracts at the principal business units, the achievement of significant
remedies in trade cases against unfairly traded steel imports and public policy
initiatives including international trade, the advancement of important
modernization projects at Burns Harbor and Pennsylvania Steel Technologies, the
receipt by Sparrows Point of ISO 9002 quality certification, the significant
reduction in general corporate overhead costs and the continued reengineering of
corporate service functions, including the information technology partnership
with Electronic Data Systems, establishing a new Corporate Services Division and
a new Benefits Services Division, and the successful completion of two major
corporate financings.
Mr. Barnette received an incentive compensation bonus award for 1994 which
is discussed under Incentive Compensation Bonuses above. Stock option and
restricted stock awards received by Mr. Barnette during 1994 are discussed under
Long Term Stock Incentives above.
Limitation on Deductibility of Executive Compensation. Section 162(m) of
the Internal Revenue Code denies a publicly held corporation, such as Bethlehem,
a federal income tax deduction for compensation in excess of $1 million per year
paid to or accrued for each of its chief executive officer and four other most
highly compensated executive officers. Certain "performance based"
compensation, such as stock options awarded under Bethlehem's 1994 Stock
Incentive Plan are not subject to the limitation on deductibility. Final
regulations have not yet been adopted under this new Internal Revenue Code
provision.
Based on Bethlehem's substantial net loss carryforwards ($1.7 billion at
December 31, 1994) and the levels of compensation of Bethlehem's executive
officers, the Committee continues to believe that the limitation on
deductibility of executive compensation is currently not material to Bethlehem.
Nevertheless, the Committee will continue to review the situation in light of
the final regulations and future events with an objective of achieving
deductibility to the extent appropriate. Restricted stock awards under the Key
Employee Stock Investment Award Program are not exempt from the limitation, but
the Committee feels that such awards are a necessary and appropriate incentive
to motivate executives and align their interests with the interests of
stockholders.
Compensation Committee
William A. Pogue, Chairman
John B. Curcio
William C. Hittinger
Winthrop Knowlton
Robert McClements, Jr.
Dean P. Phypers
12
<PAGE>
Summary Compensation Table
The following table shows the aggregate compensation awarded or paid to, or
earned by, Bethlehem's chief executive officer and each of Bethlehem's other
four most highly compensated executive officers.
<TABLE>
<CAPTION>
Annual Compensation Long Term Compensation
------------------------------------------- ----------------------
Shares
Other Underlying
Annual Restricted Options/
Compen- Stock SARs All Other
Salary ($) Bonus/2/ ($) sation/3/ ($) Award/4/ ($) Awards (#) Compensation/5/ ($)
------ ----- ------ ----- ------ ------------
<S> <C> <C> <C> <C> <C> <C>
Curtis H. Barnette
Chairman and Chief
Executive Officer
1994 $550,000 $121,000/2/ 0 $611,250/4/ 50,000 $66,237
1993 500,000 0 $ 95,647/3/ 648,750 50,000 50,976
1992 383,333/1/ 0 0 0 18,000 36,016
John A. Jordan, Jr.
Senior Vice President
1994 321,667 72,600/2/ 0 203,750/4/ 20,000 39,259
1993 302,500 0 90,337/3/ 108,125 19,000 30,405
1992 280,000 0 0 0 14,000 24,536
Gary L. Millenbruch
Executive Vice President
and Treasurer
1994 400,000 88,000/2/ 0 305,625/4/ 25,000 42,207
1993 375,000 0 251,185/3/ 216,250 23,500 33,898
1992 337,500 0 0 0 16,500 27,084
Roger P. Penny
President
1994 455,000 100,100/2/ 0 305,625/4/ 30,000 47,748
1993 425,000 0 243,581/3/ 216,250 26,000 37,171
1992 345,833 0 0 0 16,500 26,843
David P. Post
Senior Vice President
1994 270,000 59,400/2/ 0 203,750/4/ 20,000 29,980
1993 250,000 0 61,954/3/ 108,125 15,000 22,591
1992 192,167 0 0 0 6,000 16,138
</TABLE>
1. Mr. Barnette was elected chief executive officer of Bethlehem effective
November 1, 1992. His compensation for 1992 consists primarily of
compensation paid and stock options awarded for the first ten months of 1992
prior to his election as chief executive officer.
2. Each executive named in the table received an annual incentive compensation
bonus award for 1994 equal to approximately 22% of base salary at year end
1994 based on Bethlehem's 1994 net income.
13
<PAGE>
3. Represents the amount of payments to cover tax liabilities arising from the
purchase of individually owned annuities to secure a portion of the unfunded
retirement benefits payable to such officers under the Excess Benefit Plan
and Supplemental Benefits Plan.
4. Fair market value at date of issuance of restricted shares of Common Stock
awarded under the Key Employee Stock Investment Award Program. As discussed
in the Compensation Committee Report on Executive Compensation, in April,
1994, each of these officers was awarded shares of restricted stock under the
Key Employee Stock Investment Award Program with an aggregate value based on
a market value of $20.375 per share on the date of award as follows: Mr.
Barnette, 30,000 shares with an aggregate value of $611,250; Mr. Jordan,
10,000 shares with an aggregate value of $203,750; Mr. Millenbruch, 15,000
shares with an aggregate value of $305,625; Mr. Penny, 15,000 shares with an
aggregate value of $305,625; and Mr. Post, 10,000 shares with an aggregate
value of $203,750. The shares are restricted and may not be sold, transferred
or assigned until age 62. The shares will be forfeited if the recipients
voluntarily leave the employment of Bethlehem or are terminated for cause
before the restrictions expire. Dividends, it declared, are payable upon the
restricted stock.
The aggregate number of shares of restricted stock awarded under the Key
Employee Stock Investment Award Program and held by each of the named
individuals at December 31, 1994 and the aggregate value of these shares
based on a market value of $18.00 per share at December 31, 1994 is as
follows: Mr. Barnette, 72,000 restricted shares with a value of $1,296,000;
Mr. Jordan, 23,500 restricted shares with a value of $423,000;
Mr. Millenbruch, 37,000 restricted shares with a value of $666,000;
Mr. Penny, 37,000 restricted shares with a value of $666,000; and
Mr. Post, 20,000 restricted shares with a value of $360,000.
5. "All Other Compensation" consists of the following components:
<TABLE>
<CAPTION>
1994 1993 1992
---- ---- ----
<S> <C> <C> <C>
C. H. Barnette
--------------
(1) Supplemental Insurance cost $11,128 $10,486 $9,457
(2) Matching Company contribution to Savings Plan 6,000 6,289 6,103
(3) Cash or single premium annuities purchased to cover
shortfall of matching Company contribution to
Savings Plan due to Internal Revenue Code limitation 30,000 25,000 14,600
(4) Value of split dollar insurance benefit* 19,109 9,201 5,856
J. A. Jordan, Jr.
-----------------
(1) Supplemental Insurance cost $ 7,954 $7,498 $6,769
(2) Matching Company contribution to Savings Plan 6,000 6,289 6,103
(3) Cash or single premium annuities purchased to cover
shortfall of matching Company contribution to
Savings Plan due to Internal Revenue Code limitation 12,900 10,500 8,000
(4) Value of split dollar insurance benefit* 12,405 6,118 3,664
G. L. Millenbruch
-----------------
(1) Supplemental Insurance cost $ 7,376 $6,952 $6,274
(2) Matching Company contribution to Savings Plan 6,000 6,289 6,103
(3) Cash or single premium annuities purchased to cover
shortfall of matching Company contribution to
Savings Plan due to Internal Revenue Code limitation 18,700 15,800 11,700
(4) Value of split dollar insurance benefit* 10,131 4,857 3,007
</TABLE>
14
<PAGE>
<TABLE>
<S> <C> <C> <C>
R. P. Penny
-----------
(1) Supplemental Insurance cost $ 5,195 $4,901 $4,431
(2) Matching Company contribution to Savings Plan 6,000 6,289 6,103
(3) Cash or single premium annuities purchased to cover
shortfall of matching Company contribution to
Savings Plan due to Internal Revenue Code limitation 22,900 19,500 12,200
(4) Value of split dollar insurance benefit* 13,653 6,481 4,109
D. P. Post
----------
(1) Supplemental Insurance cost $ 5,379 $5,077 $4,593
(2) Matching Company contribution to Savings Plan 6,000 6,289 6,121
(3) Cash or single premium annuities purchased to cover
shortfall of matching Company contribution to
Savings Plan due to Internal Revenue Code limitation 9,000 6,700 2,416
(4) Value of split dollar insurance benefit* 9,601 4,525 3,008
</TABLE>
- ---------------------
* Split Dollar Insurance is in lieu of the Group Term Life Insurance
generally provided by Bethlehem to its salaried employees. Each
executive pays his own premium for the term life portion of the insurance
policy. Bethlehem is reimbursed for the total premium amount advanced
out of the proceeds of the insurance policy if the individual dies while
the split dollar arrangement is in effect or out of the built-up cash
value of the policy if the arrangement terminates prior to the death of
the individual. As security for repayment, Bethlehem is a collateral
assignee of the policy to the extent of any such unreimbursed premium.
Stock Option/SAR Grants In 1994/1/
- -------------------------------
<TABLE>
<CAPTION>
Potential
Realizable
Individual Grants Value at Assumed Historic (1984-1994)
- ----------------------------------------------------------------------------------------- Annual Rates of Annual Rate of
Number Percent of Total Stock Price Stock Price
of Shares Options/SARs Appreciation for Appreciation
Underlying Granted Exercise Option Term/2/ (Decline)
Options/SARs to Employees Price Expiration ------------------- ----------------
Granted (#) in 1994 (per share) Date 5% 10% (2%)
------------ ---------------- ----------- ---------- ------ ------ ----
<S> <C> <C> <C> <C> <C> <C> <C>
Curtis H. Barnette 50,000 8.90% $20.375 4-27-04 $ 640,685 $ 1,623,625 0
John A. Jordan, Jr. 20,000 3.56% 20.375 4-27-04 256,274 649,450 0
Gary L. Millenbruch 25,000 4.45% 20.375 4-27-04 320,343 811,813 0
Roger P. Penny 30,000 5.34% 20.375 4-27-04 384,411 974,175 0
David P. Post 20,000 3.56% 20.375 4-27-04 256,274 649,450 0
All Optionees (301 561,900 100.00% 20.375 4-27-04 7,200,018 18,246,298 0
executive officers
and key employees)
</TABLE>
- -------------------------
1. All stock options granted in 1994 were granted in tandem with stock
appreciation rights ("SARs"), have a term of ten years, and may be exercised
for up to one-half of the shares covered by the option commencing two years
from the date of grant and for the remaining half of the shares covered by
the option commencing four years from
15
<PAGE>
the date of the grant. The exercise price (per share) of the option is the
market price of Common Stock on the date the option is awarded.
2. These amounts represent assumed rates of appreciation only. Actual gains, if
any, on stock option exercises and Common Stock holdings are dependent on
the future performance of the Common Stock and overall market conditions. As
is shown in the next column by the historic (1984-1994) annual rate of stock
price decline for Bethlehem Common Stock during the last ten years, there
can be no assurance that the amounts reflected in these columns will be
achieved.
Aggregated Stock Option/SAR Exercises In 1994 and 12/31/94 Stock Option Values
<TABLE>
<CAPTION>
Number of Shares Value of Unexercised
Underlying Unexercised In-the-Money
Options/SARs at 12/31/94 Options/SARs at 12/31/94
Shares Acquired Value ---------------------------- ----------------------------
on Exercise (#) Realized Exercisable / Unexercisable Exercisable / Unexercisable
------------------ -------- ------------ ------------- ------------ -------------
<S> <C> <C> <C> <C> <C> <C>
Curtis H. Barnette 2,116 $101,938 97,000 / 75,000 $ 144,125 / 0
John A. Jordan, Jr. 8,366 379,625 0 / 29,500 0 / 0
Gary L. Millenbruch 0 0 89,250 / 36,750 137,563 / 0
Roger P. Penny 393 18,550 88,000 / 43,000 167,063 / 0
David P. Post 0 0 31,100 / 27,500 44,938 / 0
</TABLE>
Pension Plan Table
<TABLE>
<CAPTION>
Estimated Annual Retirement Benefit
--------------------------------------------------------------------------
25 30 35 40
Years Years Years Years
Covered of of of of
Compensation Service Service Service Service
------------ --------- --------- --------- ---------
<S> <C> <C> <C> <C>
$100,000 $ 37,500 $ 45,000 $ 52,500 $ 60,000
200,000 75,000 90,000 105,000 120,000
300,000 112,500 135,000 157,500 180,000
400,000 150,000 180,000 210,000 240,000
500,000 187,500 225,000 262,500 300,000
600,000 225,000 270,000 315,000 360,000
</TABLE>
The table above shows the estimated annual retirement benefit (before
any deductions, including social security benefits) payable in the aggregate to
Bethlehem's named executive officers under its qualified defined benefit pension
plan, its Excess Benefit Plan and its Supplemental Benefits Plan. The benefit
levels in the table assume retirement at age 62, the years of service shown, and
payment in the form of a single life annuity. Individually owned annuities were
purchased in 1993 to secure a portion of the unfunded benefits payable to the
named executive officers under the Excess Benefit Plan and the Supplemental
Benefits Plan. The amount of the benefits which were funded by the purchase of
the annuities was based on the funded level of Bethlehem's defined benefit
pension plan at June 30, 1993.
16
<PAGE>
Covered compensation for purposes of determining retirement benefits
for the named executive officers generally consists of salary and 50% of
incentive compensation reported in the "Bonus" column in the Summary
Compensation Table. The monthly retirement benefit payable is generally
determined by multiplying average monthly covered compensation for the highest
consecutive 60 months in the last 120 months of continuous service times 1.5%
times the number of credited years of service. Benefits are subject to a
deduction for social security benefits as well as certain other adjustments.
As of December 31, 1994 the credited years of service under the
Pension Plan or Supplemental Benefits Plan for Messrs. Barnette, Jordan,
Millenbruch, Penny and Post were 32 years, 37 years, 35 years, 36 years and 38
years, respectively.
Comparative Stock Performance
The following graph compares the cumulative total stockholder return
on Bethlehem Common Stock for the last five years with the cumulative total
return for the same period of the Standard & Poor's 500 Stock Index (S&P 500)
and a peer group of publicly-traded integrated steelmakers described below. The
graph assumes the investment of $100 in Bethlehem Common Stock, the S&P 500 and
the peer group on December 31, 1989 and reinvestment of all dividends. The
total return for the peer group has been weighted for market capitalization at
the beginning of each period.
The peer group consists of Armco, Inc., Inland Steel Industries, LTV
Corporation, National Steel Corporation and the U.S. Steel Group of USX
Corporation. Information has only been included for (1) LTV common stock at
December 31, 1993 and 1994, (2) National Steel Corporation at December 31, 1993
and 1994, and (3) the U.S. Steel Group of USX Corporation for December 31, 1991-
1994 since public trading did not commence in those stocks until 1993, 1993 and
1991, respectively.
[GRAPH APPEARS HERE]
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
1989 1990 1991 1992 1993 1994
- --------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Bethlehem Steel $100.00 $82.00 $79.96 $91.38 $116.36 $102.80
Corporation
S&P 500 $100.00 $96.89 $126.42 $136.05 $149.76 $149.55
Peer Group $100.00 $65.25 $66.93 $81.30 $97.37 $100.19
- --------------------------------------------------------------------------------
</TABLE>
17
<PAGE>
ADDITIONAL INFORMATION
Indemnification Assurance Agreements
It is and has been Bethlehem's policy to indemnify its officers and
directors against any costs, expenses and other liabilities to which they may
become subject by reason of their service to Bethlehem, and to insure its
directors and officers against such liabilities, as and to the extent permitted
by applicable law and in accordance with the principles of good corporate
governance. In this regard, Article IX of Bethlehem's By-laws requires
Bethlehem to indemnify its directors and officers to the maximum extent
permitted by the General Corporation Law of the State of Delaware.
Pursuant to this policy, Bethlehem has entered into individual
Indemnification Assurance Agreements with each of its directors and executive
officers pursuant to which Bethlehem has agreed to indemnify each of its
directors and executive officers to the full extent provided by applicable law
and the By-laws of Bethlehem as currently in effect. In addition, Bethlehem has
established in connection with its indemnification policy an irrevocable letter
of credit in an aggregate amount of $5 million to assure payment to each
director and executive officer of any amounts to which they may become entitled
as indemnification pursuant to the By-laws in the event that, for any reason,
Bethlehem shall not pay to them any such indemnification.
Section 102(b)(7) of the General Corporation Law of the State of
Delaware permits a Delaware corporation to include in its certificate of
incorporation a provision eliminating the potential monetary liability of a
director to the corporation or its stockholders for breach of fiduciary duty as
a director, provided that such provision shall not eliminate the liability of a
director (i) for any breach of the director's duty of loyalty to the corporation
or its stockholders, (ii) for acts or omissions not in good faith or which
involve intentional misconduct or a knowing violation of law, (iii) for improper
payment of dividends, or (iv) for any transaction from which the director
receives an improper personal benefit. Bethlehem's Second Restated Certificate
of Incorporation includes such a provision in Article Ninth thereof.
Stockholders
Holders of record of Bethlehem's Common Stock and ESOP Preference
Stock at the close of business on March 6, 1995 ("Record Date"), are entitled to
notice of the Annual Meeting and to vote at the Meeting the shares held on that
date. Each share of Common Stock and ESOP Preference Stock is entitled to one
vote. On the Record Date, a total of ______________ shares of Common Stock of
Bethlehem, owned of record by approximately ________ stockholders, were
outstanding and a total of ________________ shares of Preference Stock of
Bethlehem, owned of record by a trustee under a qualified plan for approximately
_________ participants, were outstanding. Set forth below are the only persons
who, to the knowledge of the Board of Directors, were the beneficial owners of
5% or more of Bethlehem's Common Stock on the Record Date:
<TABLE>
<CAPTION>
Name and Address of Number of Percent of
Beneficial Owner Shares Class
- ------------------------------------ ---------- ----------
<S> <C> <C>
The Equitable Companies Incorporated/1/
787 Seventh Avenue
New York, New York 10019.................... 17,276,700 15.5%
Norwest Corporation/2/
Norwest Center, Sixth Street and
Marquette Avenue
Minneapolis, Minnesota 55479-1000........... 7,439,346 6.8%
</TABLE>
- --------------------------
1. Bethlehem received a copy of a Schedule 13G filed with the Securities
and Exchange Commission jointly by: (i) AXA Assurances I.A.R.D.
Mutuelle, (ii) AXA Assurances Vie Mutuelle, (iii) Alpha Assurances
I.A.R.D. Mutuelle, (iv) Alpha Assurances Vie Mutuelle, (v) Uni Europe
Assurance Mutuelle, (vi) AXA, and (vii) The Equitable Companies
Incorporated, indicating that, at December 31, 1994, The Equitable
Companies Incorporated, through its subsidiaries, The Equitable Life
Assurance Society of the United States, Donaldson, Lufkin & Genrett
Securities, and Alliance Capital Management, L.P., had aggregate
beneficial ownership of 17,276,700 shares of Bethlehem Common Stock
including 848,680 shares of Common Stock issuable upon conversion of
Bethlehem's $3.50 Convertible Preferred Stock. The Equitable Companies
Incorporated is a subsidiary of AXA, and AXA is jointly-owned by AXA
Assurances I.A.R.D. Mutuelle, AXA Assurances Vie Mutuelle, Alpha
Assurances I.A.R.D. Mutuelle, Alpha Assurances Vie Mutuelle, and Uni
Europe Assurance Mutuelle.
2. Bethlehem received copies of Schedule 13Gs filed with the Securities
and Exchange Commission by Norwest Corporation, indicating that, at
December 31, 1994, Norwest Corporation, through its subsidiaries,
Norwest Colorado, Inc. and Norwest Bank Colorado, National Association,
had aggregate beneficial ownership of 7,439,346 shares of Bethlehem
Common Stock including shares issuable upon conversion of (i) 967
shares of Bethlehem's $2.50 Convertible Preferred Stock and (ii) 2,625
shares of Bethlehem's $5.00 Convertible Preferred Stock.
To the knowledge of the Board of Directors, there were no persons who
beneficially owned 5% or more of the ESOP Preference Stock on the Record Date.
Other Matters
Management and the Board of Directors do not know of any matters other than
those set forth in the form of proxy that will be presented for consideration at
the 1995 Annual Meeting. However, execution of a proxy, unless otherwise
indicated, confers on the persons named as proxies discretionary authority to
vote the shares represented in accordance with their best judgment on other
business, if any, that may properly come before the Meeting.
18
<PAGE>
The cost of soliciting proxies will be borne by Bethlehem. A number of its
officers and regular employees may solicit proxies personally and by telephone.
Bethlehem has engaged Georgeson & Company, Inc. to assist in soliciting proxies
from brokers, bank nominees and institutional holders for an estimated fee of
$10,000 plus expenses. Arrangements have been made for brokerage houses,
nominees and other custodians and fiduciaries to send proxy material to their
principals, and Bethlehem will reimburse them for their expenses in doing so.
March 15, 1995
19
<PAGE>
Exhibit A
Deletions are in brackets; new language is underscored.
Proposed Revised Form of
First Paragraph of Article Fourth
of Bethlehem's Second Restated Certificate of Incorporation
-----------------------------------------------------------
FOURTH. The total number of shares of all classes of stock which the
Corporation shall have authority to issue is [one] two hundred ninety million
---
[190,000,000], (290,000,000), of which (i) twenty million (20,000,000) shares
--------------
are to be Preferred Stock (hereinafter called the "Preferred Stock"), of the par
value of one dollar ($1) each; (ii) twenty million (20,000,000) shares are to be
Preference Stock (hereinafter called the "Preference Stock"), of the par value
of one dollar ($1) each; and (iii) [one] two hundred fifty million [150,000,000]
---
(250,000,000) shares are to be Common Stock (hereinafter called the "Common
- -------------
Stock"), of the par value of one dollar ($1) each.
[No changes to remainder of Article Fourth.]
<PAGE>
[Front]
BETHLEHEM STEEL CORPORATION
1170 Eighth Avenue
Bethlehem, PA 18016-7699
P
R This Proxy is Solicited on Behalf of the Board of Directors
O for the Annual Meeting of Stockholders, April 25, 1995
X
Y
The undersigned hereby appoints Curtis H. Barnette, Roger P. Penny and
Gary L. Millenbruch the proxies (each with power to act alone and with
power of substitution) of the undersigned to represent and vote the
shares of stock which the undersigned is entitled to vote at the Annual
Meeting of Stockholders of Bethlehem Steel Corporation to be held on
April 25, 1995, and at any adjournment or postponement thereof, as
hereinafter specified and, in their discretion, upon such other matters
as may properly come before the Meeting.
Election of Directors. Nominees:
C. H. Barnette, B. R. Civiletti, W. H. Clark, J. B. Curcio,
T. L. Holton, L. B. Kaden, H. P. Kamen, W. Knowlton,
R. McClements, Jr., G. L. Millenbruch, R. P. Penny, D. P. Phypers,
W. A. Pogue, J. F. Ruffle
You are encouraged to specify your choice by marking the appropriate
boxes on the reverse side. On matters on which you do not specify a
choice, your shares will be voted in accordance with the recommendation
of Bethlehem's Board of Directors. Please mark, sign, date and return
this proxy promptly using the enclosed envelope.
[SEE REVERSE SIDE]
<PAGE>
[Back]
[X] Please mark your votes
as in this example.
If this card is properly executed, shares will be voted in the manner
directed herein by the undersigned. If no direction is made, this proxy will be
voted FOR Proposals 1, 2 and 3.
Bethlehem's Board of Directors recommends a vote FOR election of directors and
Proposals 2 and 3.
FOR WITHHELD
1. Election of Directors. (see reverse) [ ] [ ]
For, except vote withheld from the following nominee(s):
--------------------------------------------------------
FOR AGAINST ABSTAIN
2. Increase in number of authorized shares of [ ] [ ] [ ]
Common Stock.
FOR AGAINST ABSTAIN
3. Ratification of appointment of Independent [ ] [ ] [ ]
Auditors.
SIGNATURE(S): DATE
------------------------------------ ---------------------
NOTE: Please sign exactly as name appears above. Joint owners should each sign.
When signing as attorney, executor, administrator, trustee or guardian,
please give full title as such.
<PAGE>
[Front]
BETHLEHEM STEEL CORPORATION
1170 Eighth Avenue
Bethlehem, PA 18016-7699
Savings Plan for Salaried Employees of Bethlehem Steel Corporation and
Subsidiary Companies
Voting Instructions for the Annual Meeting of Stockholders, April 25, 1995
To Employee Benefits Administration Committee:
The undersigned hereby instructs you to vote, in person or by proxy, upon all
matters properly brought before the Annual Meeting of Stockholders of Bethlehem
Steel Corporation to be held on April 25, 1995, and any adjournment or
postponement thereof, the shares of stock which were allocated to my account as
of March 6, 1995 under the Savings Plan for Salaried Employees of Bethlehem
Steel Corporation and Subsidiary Companies.
Election of Directors. Nominees:
C. H. Barnette, B. R. Civiletti, W. H. Clark, J. B. Curcio, T. L. Holton,
L. B. Kaden, H. P. Kamen, W. Knowlton, R. McClements, Jr.,
G. L. Millenbruch, R. P. Penny, D. P. Phypers, W. A. Pogue, J. F. Ruffle
If you return this card properly signed but do not otherwise specify on the
reverse side, shares will be voted FOR Proposals 1, 2 and 3. If you do not
return this card, shares will be voted by the Trustee in accordance with
instructions of the Employee Benefits Administration Committee.
<PAGE>
[SEE REVERSE SIDE]
[Back]
[X] Please mark your votes
as in this example.
If this card is properly executed, shares will be voted in the manner
directed herein by the undersigned. If no direction is made, shares will be
voted FOR Proposals 1, 2 and 3.
Bethlehem's Board of Directors recommends a vote FOR election of directors and
Proposals 2 and 3.
FOR WITHHELD
1. Election of Directors. (see reverse) [ ] [ ]
For, except vote withheld from the following nominee(s):
--------------------------------------------------------
FOR AGAINST ABSTAIN
2. Increase in number of authorized shares of [ ] [ ] [ ]
Common Stock.
FOR AGAINST ABSTAIN
3. Ratification of appointment of Independent [ ] [ ] [ ]
Auditors.
SIGNATURE(S): DATE
------------------------------------- ------------------
NOTE: Please mark, date, sign as name appears above and return in enclosed
envelope.
<PAGE>
Savings Plan for Salaried Employees of
Bethlehem Steel Corporation and Subsidiary Companies
To Participants in the Savings Plan:
The enclosed form is for use in causing the shares of Common Stock of
Bethlehem Steel Corporation acquired with your own and/or Company contributions
and allocated to your Savings Plan account to be voted in accordance with your
instructions at the 1995 Annual Meeting of Stockholders of Bethlehem. The 1994
Annual Report of Bethlehem and the Proxy Statement, dated March 15, 1995,
relating to matters to be voted on at the Meeting, are enclosed.
If you wish to have the shares allocated to your Savings Plan account voted
in accordance with your instructions, you should specify your choices on the
enclosed form, sign and date it and forward it to UJB-Financial Service Corp. in
the enclosed, pre-addressed, stamped envelope. To preserve confidentiality,
voting instructions from Savings Plan participants will be tabulated by
UJB-Financial Service Corp., which will certify the results to the Employee
Benefits Administration Committee. Your individual voting instructions will not
be seen by Bethlehem, the Employee Benefits Administration Committee or State
Street Bank and Trust Company, the Trustee under the Savings Plan.
Your voting instructions will relate only to shares allocated to your
Savings Plan account as of March 6, 1995. Any shares held by you as a
stockholder outside the Savings Plan should be voted by execution of a proxy
which you will receive separately as such a stockholder.
If you do not provide voting instructions, the shares allocated to your
Savings Plan account will be voted by the Trustee in accordance with
instructions of the Employee Benefits Administration Committee.
Employee Benefits Administration Committee
March 15, 1995 Michael P. Dopera, Secretary
<PAGE>
[Front]
BETHLEHEM STEEL CORPORATION
1170 Eighth Avenue
Bethlehem, PA 18016-7699
Employee Stock Ownership Plan
Voting Instructions for the Annual Meeting of Stockholders, April 25, 1995
To Employee Stock Ownership Plan Trustee:
The undersigned hereby instructs you to vote, in person or by proxy, upon all
matters properly brought before the Annual Meeting of Stockholders of Bethlehem
Steel Corporation to be held on April 25, 1995, and any adjournment or
postponement thereof, the shares of stock which were allocated to my account as
of March 6, 1995 under the Bethlehem Steel Corporation Employee Stock Ownership
Plan.
Election of Directors. Nominees:
C. H. Barnette, B. R. Civiletti, W. H. Clark, J. B. Curcio, T. L. Holton,
L. B. Kaden, H. P. Kamen, W. Knowlton, R. McClements, Jr.,
G. L. Millenbruch, R. P. Penny, D. P. Phypers, W. A. Pogue, J. F. Ruffle
If you return this card properly signed but do not otherwise specify on the
reverse side, shares will be voted FOR Proposals 1, 2 and 3. If you do not
return this card, shares will be voted by the Trustee in the same proportion as
the shares with respect to which such instructions are received.
<PAGE>
[SEE REVERSE SIDE]
[Back]
[X] Please mark your votes
as in this example.
If this card is properly executed, shares will be voted in the manner
directed herein by the undersigned. If no direction is made, shares will be
voted FOR Proposals 1, 2 and 3.
Bethlehem's Board of Directors recommends a vote FOR election of directors and
Proposals 2 and 3.
FOR WITHHELD
1. Election of Directors. (see reverse) [ ] [ ]
For, except vote withheld from the following nominee(s):
--------------------------------------------------------
FOR AGAINST ABSTAIN
2. Increase in number of authorized shares of
Common Stock. [ ] [ ] [ ]
FOR AGAINST ABSTAIN
3. Ratification of appointment of Independent
Auditors. [ ] [ ] [ ]
SIGNATURE(S): DATE
------------------------------------- --------------------
NOTE: Please mark, date, sign as name appears above and return in enclosed
envelope.
<PAGE>
Bethlehem Steel Corporation
Employee Stock Ownership Plan
To Participants in Bethlehem Steel Corporation Employee Stock Ownership Plan:
The enclosed form is for use in causing the shares of Preference Stock or
Common Stock of Bethlehem Steel Corporation allocated to your Employee Stock
Ownership Plan account to be voted in accordance with your instructions at the
1995 Annual Meeting of Stockholders of Bethlehem. The 1994 Annual Report of
Bethlehem and the Proxy Statement, dated March 15, 1995, relating to matters to
be voted on at the Meeting, are enclosed.
If you wish to have the shares allocated to your Employee Stock Ownership
Plan account voted in accordance with your instructions, you should specify your
choices on the enclosed form, sign and date it and forward it to UJB-Financial
Service Corp. in the enclosed, pre-addressed, stamped envelope. To preserve
confidentiality, voting instructions from Employee Stock Ownership Plan
participants will be tabulated by UJB-Financial Service Corp., which will
certify the results directly to State Street Bank and Trust Company, the
Employee Stock Ownership Plan Trustee. Your individual voting instructions will
not be seen by any officer or employee of Bethlehem.
Your voting instructions will relate only to shares allocated to your
Employee Stock Ownership Plan account as of March 6, 1995. Any shares of
Bethlehem Common Stock held by you as a stockholder outside the Employee Stock
Ownership Plan should be voted by execution of a proxy which you will receive
separately as such a stockholder.
If you do not provide voting instructions, the shares allocated to your
Employee Stock Ownership Plan account will be voted by the Trustee in the same
proportion as the shares with respect to which such instructions are received.
Bethlehem Steel Corporation
Employee Stock Ownership Plan
Thomas J. Broderick, Representative of
March 15, 1995 Plan Administrator
