<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )
Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section 240.14a-11(c) or Section
240.14a-12
COLTEC INDUSTRIES INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/X/ $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.
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
------------------------------------------------------------------------
2) Form, Schedule or Registration Statement No.:
------------------------------------------------------------------------
3) Filing Party:
------------------------------------------------------------------------
4) Date Filed:
------------------------------------------------------------------------
<PAGE>
COLTEC INDUSTRIES INC
[LOGO]
430 PARK AVENUE
NEW YORK, NEW YORK 10022
- --------------------------------------------------------------------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS -- MAY 1, 1996
To the Shareholders of Coltec Industries Inc:
NOTICE IS HEREBY GIVEN that the Annual Meeting of Shareholders of Coltec
Industries Inc ("Coltec") will be held at the Des Moines Marriott Hotel, 700
Grand Avenue, Des Moines, Iowa, on Wednesday, May 1, 1996, at 10:00 a.m., local
time, for the following purposes and for the transaction of such other business
as may be properly brought before the meeting:
1. Electing a Board of Directors consisting of seven members. [Proposal 1]
2. Ratifying the appointment of Arthur Andersen LLP as the independent
public accountants of Coltec to serve as such at the pleasure of the
Board of Directors. [Proposal 2]
Only holders of record of Common Stock of Coltec at the close of business on
March 18, 1996, are entitled to notice of the meeting and to vote thereat and at
any and all adjournments thereof.
By order of the Board of Directors
Robert J. Tubbs
SECRETARY
March 22, 1996
YOUR VOTE IS IMPORTANT.
TO VOTE YOUR SHARES, PLEASE MARK, SIGN AND DATE THE ENCLOSED PROXY CARD
AND MAIL IT PROMPTLY IN THE ENCLOSED POSTAGE-PAID RETURN ENVELOPE.
<PAGE>
COLTEC INDUSTRIES INC
[LOGO]
430 PARK AVENUE
NEW YORK, NEW YORK 10022
- --------------------------------------------------------------------------------
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS -- MAY 1, 1996
This Proxy Statement is furnished in connection with the solicitation on
behalf of the Board of Directors of Coltec Industries Inc ("Coltec") of proxies
for use at the Annual Meeting of Shareholders of Coltec to be held on May 1,
1996, and at any adjournments thereof. The approximate date on which this Proxy
Statement and the accompanying form of proxy will first be sent to Coltec's
shareholders is March 29, 1996. Any proxy being solicited herewith may be
revoked at any time prior to its exercise, but the revocation of the proxy shall
not be effective until notice thereof has been given to the Secretary of Coltec.
Appearance in person at the Annual Meeting will not constitute a revocation of
an otherwise valid proxy. In the event that shares are represented by more than
one properly executed proxy, the proxy bearing the most recent date will be
voted at the Annual Meeting.
Each shareholder of record on March 18, 1996 is entitled to vote every share
held in his or her name on the books of Coltec. On March 18, 1996, there were
outstanding 70,168,963 shares of Coltec's Common Stock, par value $.01 per share
(not including 100,346 shares held in treasury and 25,000,000 shares held by a
wholly owned subsidiary) (the "Common Stock"). Coltec's transfer books will not
be closed. Each share which may be voted at the Annual Meeting is entitled to
one vote on all matters to be considered. Votes will be counted and certified by
the Inspector of Election, who is an employee of Chemical Mellon Shareholder
Services, L.L.C., Coltec's independent Transfer Agent and Registrar. Under
Securities and Exchange Commission rules, boxes and designated blank spaces are
provided on the accompanying form of proxy for shareholders to mark if they wish
either to withhold authority to vote for one or more nominees for director or to
abstain on Proposal 2. Votes withheld in connection with the election of one or
more of the nominees for director will not be counted as votes cast for such
individual. In accordance with Pennsylvania law, abstentions are not counted in
determining the votes cast in connection with Proposal 2. Under New York Stock
Exchange rules, the election of directors and appointment of independent
auditors are considered "discretionary" items upon which brokerage firms may
vote in their discretion on behalf of their clients if such clients have not
furnished voting instructions within ten days of the shareholders' meeting.
The presence at the meeting, in person or by proxy, of the holders of a
majority of the outstanding shares of stock entitled to vote is the required
quorum for the transaction of business at the meeting.
PROPOSAL 1 -- ELECTION OF DIRECTORS
One purpose of the meeting is to elect seven directors to serve until the
next Annual Meeting or until their successors are elected and qualified. The
seven nominees receiving the greatest number of votes cast by the holders of the
Common Stock entitled to vote at the meeting will be elected directors of Coltec
(assuming a quorum is present). All proxies will be voted in accordance with
instructions contained thereon. If no specific instructions are given, the
persons named as proxies in the accompanying form of proxy will vote for the
seven nominees named by the Board of Directors of Coltec and listed below. In
the event that, by reason of death or other unexpected occurrence, any one or
more of such nominees shall not be available for election, the persons named as
proxies in the form of proxy have advised that they will vote for such
substitute nominees as the Board of Directors of Coltec may propose. A vote FOR
the nominees includes discretionary authority to vote for a substitute nominee
if any of the nominees listed becomes unable or unwilling to serve.
<PAGE>
All nominees are currently directors of Coltec and were previously elected
by the shareholders:
<TABLE>
<CAPTION>
DIRECTOR OF
COLTEC (OR
PREDECESSOR)
NAME, AGE AND BUSINESS EXPERIENCE DURING PAST FIVE YEARS SINCE
- ---------------------------------------------------------------------------------------------------- -------------
<S> <C>
Joseph R. Coppola, 65............................................................................... 1994
Member of the Audit Committee and member of the Stock Option and Compensation Committee of Coltec.
Chairman, Chief Executive Officer and President of Giddings & Lewis, Inc., a machine tool
manufacturing company, since July 1993. From prior to 1991 to July 1993 he was Senior Vice
President, Manufacturing Services of Cooper Industries, Inc., a diversified manufacturing
company. Director of Belden Inc., a manufacturer of electrical wire and cable.
John W. Guffey, Jr., 58............................................................................. 1991
Chairman of the Board, Chief Executive Officer and President of Coltec since February 1995. Member
of the Executive Committee of Coltec. President and Chief Operating Officer of Coltec from May
1991 to January 1995. From prior to 1991 to May 1991 he was the President of the Mechanical
Packing Division of Garlock Inc, a wholly owned subsidiary of Coltec, and served as a Group
President of Coltec. Director of Gleason Corp., a manufacturer of machine tools, and Giddings &
Lewis, Inc.
David I. Margolis, 66............................................................................... 1963
Chairman of the Executive Committee of Coltec since October 1994. Chairman of the Board and Chief
Excutive Officer of Coltec from prior to 1991 to retirement from Coltec in January 1995.
President of Coltec from prior to 1991 to May 1991. Director of Burlington Industries, Inc., a
manufacturer of textiles, and Fort Howard Corporation, a manufacturer of paper products.
J. Bradford Mooney, Jr., 65......................................................................... 1992
Chairman of the Audit Committee and member of the Stock Option and Compensation Committee of
Coltec. Rear Admiral, United States Navy (retired). President and Managing Director of Harbor
Branch Oceanographic Institution, Inc. from prior to 1991 to March 1992. Consultant in ocean
engineering and research management since September 1987.
Joel Moses, 54...................................................................................... 1992
Chairman of the Stock Option and Compensation Committee and member of the Executive Committee of
Coltec. Provost, Massachusetts Institute of Technology ("MIT"), since June 1995. D.C. Jackson
Professor of Computer Science and Engineering, MIT since January 1991. Dean, School of
Engineering, MIT, from January 1991 to June 1995. Director of Analog Devices, Inc., a
manufacturer of integrated circuits.
Paul G. Schoen, 51.................................................................................. 1994
Executive Vice President, Finance; Treasurer and Chief Financial Officer of Coltec since January
1994. Senior Vice President, Finance; Treasurer and Chief Financial Officer of Coltec from May
1991 to December 1993. Senior Vice President and Controller of Coltec from January 1991 to May
1991.
Richard A. Stuckey, 64.............................................................................. 1994
Member of the Audit Committee and member of the Stock Option and Compensation Committee of Coltec.
Chief Economist, E.I. du Pont de Nemours and Company, Inc. from prior to 1991 to retirement from
E.I. du Pont de Nemours and Company, Inc. in December 1994. Economic consultant since January
1995.
</TABLE>
2
<PAGE>
BOARD OF DIRECTORS, COMMITTEES AND ATTENDANCE AT MEETINGS
The Board of Directors of Coltec held 10 meetings during 1995. The Board of
Directors of Coltec has standing audit, compensation and executive committees
and does not have a nominating committee.
The Audit Committee, which consists of Mr. Mooney (Chairman), Mr. Coppola
and Mr. Stuckey, held two meetings during 1995. This Committee meets with
representatives of Coltec's independent public accountants and meets with
Coltec's internal auditors and representatives of the financial departments to
consider matters relating to the annual audit (including objectives, scope and
fees) and such other matters as such auditors and representatives wish to raise
for consideration. This Committee also reviews with representatives of the
financial departments and internal auditors and representatives of Coltec's
independent public accountants recommendations of any of such auditors to
improve internal accounting procedures and controls. This Committee reports to
the Board of Directors and serves as liaison between the Board of Directors and
Coltec's independent public accountants.
The Stock Option and Compensation Committee (the "Compensation Committee"),
which consists of Professor Moses (Chairman) and Messrs. Coppola, Mooney and
Stuckey, held five meetings during 1995. This Committee prescribes salaries,
incentive awards and other compensation of the executive officers of Coltec.
This Committee also administers certain of Coltec's compensation plans.
The Executive Committee, which consists of Mr. Margolis (Chairman) and
Messrs. Guffey and Moses, held two meetings in 1995. This Committee provides
oversight of Board affairs, oversight of relationships with principal
shareholders, long-term strategic planning, and advice on political and
legislative matters.
During 1995, each director attended 75% or more of the aggregate of (i) the
total number of meetings of the Board of Directors and (ii) the total number of
meetings held by all committees on which he served.
Since January 1, 1995, Coltec and its subsidiary corporations have purchased
machine tool products and related services from Giddings & Lewis, Inc. for
amounts aggregating approximately $4.6 million. These purchases were effected in
the ordinary course of business on terms at least as favorable to Coltec and its
subsidiaries as those obtainable in similar transactions with unaffiliated
parties and include the purchase of two numerically-controlled boring mill
machine tools at costs in excess of $2 million each.
3
<PAGE>
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
Set forth below is certain information (as of March 1, 1996) with respect to
persons known to Coltec to be the beneficial owners of more than five percent of
the Common Stock. This information is based on statements on Schedules 13D or
13G filed by beneficial owners with the Securities and Exchange Commission and
other information available to Coltec.
<TABLE>
<CAPTION>
AMOUNT AND
NATURE OF
BENEFICIAL PERCENT OF
NAME AND ADDRESS OF BENEFICIAL OWNER OWNERSHIP CLASS(A)
- -------------------------------------------------- ----------- ------------
<S> <C> <C>
J.P. Morgan & Co. Incorporated.................... 14,370,138 20.5(b)
60 Wall Street
New York, NY 10260
Oppenheimer Group, Inc............................ 8,617,104 12.3(c)
Oppenheimer Tower
World Financial Center
New York, NY 10281
Neuberger & Berman L.P............................ 7,259,039 10.3(d)
605 Third Avenue
New York, NY 10158
The Capital Group Companies, Inc.................. 5,364,900 7.6(e)
333 South Hope Street
Los Angeles, CA 90071
The Equitable Companies Incorporated.............. 5,155,750 7.3(f)
787 Seventh Avenue
New York, NY 10019
GSB Investment Mgmt., Inc......................... 4,601,165 6.6(g)
301 Commerce Street, Suite 1501
Fort Worth, TX 76102
</TABLE>
- ------------------------
(a) The percentage is calculated on the basis of 70,168,963 shares of Common
Stock outstanding on March 1, 1996.
(b) In its Amendment No. 4 to Schedule 13G dated December 29, 1995, J.P. Morgan
& Co. Incorporated reported that it has sole voting power for 9,863,033
shares, shared voting power for 121,400 shares, sole investment power for
14,137,238 shares and shared investment power for 185,400 shares.
(c) In its Amendment No. 4 to Schedule 13G dated February 1, 1996, Oppenheimer
Group, Inc. reported that it had shared voting power and shared investment
power (with certain of its affiliates) with respect to all such shares and
that it had filed such Schedule 13G on its behalf and on behalf of certain
of its affiliates as a parent holding company.
(d) In its Amendment No. 1 to Schedule 13G dated February 16, 1996, Neuberger &
Berman L.P. reported that it had sole voting power for 1,897,700 shares,
shared voting power for 3,913,300 shares and shared investment power for
7,259,039 shares and that it had filed such Schedule 13G as a broker dealer
and registered investment adviser.
(e) In its Amendment No. 2 to Schedule 13G dated February 9, 1996, The Capital
Group Companies, Inc. reported that Capital Guardian Trust Company and
Capital Research and Management Company, operating subsidiaries of The
Capital Group Companies, Inc., exercised investment discretion with respect
to 4,344,900 and 1,020,000 shares, respectively, or a combined total of 7.6%
of the outstanding stock which was owned by various institutional investors.
(f) In its Amendment No. 5 to Schedule 13G dated February 9, 1996, The Equitable
Companies Incorporated reported that it had sole voting power for 4,204,350
shares, shared voting power for
4
<PAGE>
310,000 shares, sole investment power for 5,166,450 shares, shared
investment power for 200 shares and that it had filed such Schedule 13G on
its behalf and on behalf of certain of its affiliates as a parent holding
company.
(g) In its Schedule 13G dated February 1, 1996, GSB Investment Mgmt., Inc.
reported that it had sole voting power for 2,166,180 shares, sole investment
power for 4,397,315 shares and shared investment power for 203,850 shares
and that it had filed such Schedule 13G as a registered investment adviser.
SECURITY OWNERSHIP OF MANAGEMENT
Set forth below is information as of March 1, 1996, concerning ownership of
Common Stock by all directors and nominees, individually, the executive officers
named in the Summary Compensation Table below and all current executive officers
and directors of Coltec as a group:
<TABLE>
<CAPTION>
AMOUNT AND
NATURE OF
BENEFICIAL PERCENT OF
NAME OWNERSHIP(A) CLASS(B)
- -------------------------------------------------- ------------ -----------
<S> <C> <C>
Joseph R. Coppola................................. 3,000 *
John M. Cybulski(c)............................... 147,601 *
Richard L. Dashnaw(c)............................. 109,465 *
John W. Guffey, Jr.(c)............................ 363,415 *
David I. Margolis(c).............................. 296,475 *
J. Bradford Mooney, Jr............................ 2,250 *
Joel Moses........................................ 2,200 *
Laurence H. Polsky(c)............................. 98,903 *
Paul G. Schoen(c)................................. 130,010 *
Richard A. Stuckey................................ 2,200 *
All directors and executive officers as a group,
consisting of 11 persons......................... 1,167,980 1.6
</TABLE>
- ------------------------
* Less than 1%.
(a) Includes shares subject to options exercisable presently or within 60 days
as follows: Mr. Coppola, 2,000 shares; Messrs. Cybulski and Dashnaw, 64,000
shares each; Mr. Guffey, 203,000 shares; Mr. Margolis, 240,000 shares;
Messrs. Mooney and Moses, 2,000 shares each; Mr. Polsky, 80,000 shares; Mr.
Schoen, 88,000 shares; Mr. Stuckey, 2,000 shares; and all directors and
executive officers as a group, 759,000 shares.
(b) The percentages are calculated on the basis of 70,168,963 shares of Common
Stock outstanding on March 1, 1996, plus, for any individual or the group,
that number of shares deemed to be outstanding because the indicated persons
or certain members of the group, respectively, have the right to acquire
beneficial ownership within 60 days.
(c) Messrs. Guffey, Polsky and Schoen share certain voting power of 2,800,779
shares (as of January 31, 1996) as trustees of the Coltec Retirement Savings
Plan for Salaried Employees (the "Savings Plan"). They disclaim beneficial
ownership as to such shares. However, as participants in the Savings Plan,
they and Messrs. Cybulski, Dashnaw and Margolis have the following shares of
Common Stock credited to their individual accounts as of December 31, 1995
and such shares are included in the table above: Mr. Cybulski, 2,788 shares;
Mr. Dashnaw, 4,951 shares; Mr. Guffey, 4,999 shares; Mr. Margolis, 3,631
shares; Mr. Schoen, 5,011 shares; and Mr. Polsky, 1,713 shares.
5
<PAGE>
EXECUTIVE COMPENSATION AND OTHER INFORMATION
SUMMARY OF CASH AND CERTAIN OTHER COMPENSATION
The following table provides certain summary information concerning
compensation of Coltec's Chief Executive Officers during 1995 and each of the
four other most highly compensated executive officers of Coltec (determined as
of December 31, 1995) (hereinafter referred to as the "named executive
officers") for the fiscal years ended December 31, 1995, 1994 and 1993:
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG TERM COMPENSATION
---------------------------------------
AWARDS
-------------------------- PAYOUTS
ANNUAL COMPENSATION ----------
---------------------------------------- (F) (G)
(E) ---------- -------------- (H) (I)
(A) (C) (D) ------------ RESTRICTED SECURITIES ---------- --------------------
- ------------------------- (B) -------- ---------- OTHER ANNUAL STOCK UNDERLYING LTIP ALL OTHER
NAME AND PRINCIPAL ---- SALARY BONUS COMPENSATION AWARDS OPTIONS PAYOUT COMPENSATION
POSITION YEAR ($) ($)(1) ($) ($)(2) (#) ($) ($)(3)
- ------------------------- ---- -------- ---------- ------------ ---------- -------------- ---------- --------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
John W. Guffey, Jr....... 1995 $666,360 $ 944,000 $ -- $ -- 550,000 $ -- $111,920
Chairman of the Board, 1994 534,240 855,000 -- -- 115,000 -- 51,421
President and Chief 1993 471,960 1,125,500 -- -- -- -- 113,529
Executive Officer
Paul G. Schoen........... 1995 350,280 380,000 -- -- 250,000 -- 55,061
Executive Vice President, 1994 312,720 438,000 -- -- -- -- 32,527
Finance; Treasurer and 1993 249,540 394,200 -- -- 60,000 -- 46,938
Chief Financial Officer
Laurence H. Polsky....... 1995 307,800 350,000 -- -- 250,000 -- 49,167
Executive Vice President, 1994 285,000 400,000 -- -- -- -- 29,815
Administration 1993 249,540 394,200 -- -- 40,000 -- 45,271
John M. Cybulski......... 1995 336,060 210,000 -- -- 160,000 -- 44,035
Senior Vice President, 1994 320,040 240,000 -- -- -- -- 33,080
Aerospace 1993 320,040 236,000 -- -- -- -- 37,142
Richard L. Dashnaw....... 1995 267,180 160,000 -- -- 160,000 -- 28,151
Senior Vice President, 1994 238,560 202,000 -- -- -- -- 15,274
Group Operations (4)
David I. Margolis........ 1995 56,345 -- -- -- -- -- 68,301
Retired, 1994 676,140 1,082,000 -- -- -- -- 40,568
Chairman of the Board 1993 643,920 1,545,500 -- -- -- -- 120,535
and Chief Executive
Officer until retirement
in January 1995
</TABLE>
- ------------------------------
(1) Includes the following annual amounts accrued but not paid under the 1977
Long-Term Performance Plan (the "Performance Plan") for each of the named
executive officers for 1993: Mr. Guffey, $332,500; Mr. Schoen, $79,800; Mr.
Polsky, $79,800; Mr. Cybulski, $79,800; and Mr. Margolis, $465,500.
Effective as of December 31, 1993, the Performance Plan was terminated with
no additional accruals thereafter. On January 10, 1996, the amounts then
accrued plus 15% thereof were converted into restricted stock based on the
closing price of the Common Stock on that date, $11. The 15% increase
recognized that (i) the value of stock ownership reflects the rise and fall
of Coltec's stock price, (ii) there will be no interest accruals and (iii)
a one year restriction was added from the date on which accrued amounts
would have vested. For amounts fully vested prior to the conversion to
restricted stock, restrictions will lapse on January 2, 1997 and on January
2, 1998 for amounts 80% vested and on January 2, 1999 for amounts 60%
vested.
(2) The restricted stock owned by each of the named executive officers at
December 31, 1995 and the values thereof based on the closing price of the
Common Stock on December 29, 1995 were as follows: Mr. Guffey, 23,600
shares, $274,350; Mr. Schoen, 8,222 shares, $95,581; Mr. Cybulski, 19,467
shares, $226,304; and Mr. Margolis, 52,844 shares, $614,312. Restrictions
on one half of the number of such shares of restricted stock lapsed on
January 2, 1996 and restrictions on the balance of the number of such
shares are scheduled to lapse on January 2, 1997. Any dividends payable on
the Common Stock would also be payable on such restricted stock.
(3) Pursuant to the Retirement Savings Plan for Salaried Employees, the amounts
credited by Coltec for 1995, 1994 and 1993 for each of the named executive
officers were as follows: Mr. Guffey, 1995, $9,000; 1994, $8,912; 1993,
$8,994; Mr. Schoen, 1995, $9,000; 1994, $9,000; 1993, $8,994; Mr. Polsky,
1995, $9,000; 1994, $8,996; 1993, $8,994; Mr. Cybulski, 1995, $9,000; 1994,
$8,972; 1993, $8,994; Mr. Dashnaw, 1995, $9,000; 1994, $8,888; and Mr.
Margolis, 1995, $9,000; 1994, $8,757; 1993, $8,994 and such amounts are
included in the amounts in column (i) above. Pursuant to the defined
contribution portion of
6
<PAGE>
the Benefits Equalization Plan, the amounts credited by Coltec for 1995,
1994 and 1993 for each of the named executive officers were as follows: Mr.
Guffey, 1995, $82,281; 1994, $23,142; 1993, $85,168; Mr. Schoen, 1995,
$38,297; 1994, $9,763; 1993, $29,792; Mr. Polsky, 1995, $33,468; 1994,
$8,104; 1993, $29,174; Mr. Cybulski, 1995, $25,564; 1994, $10,230; 1993,
$28,148; and Mr. Margolis, 1995, $59,301; 1994, $31,811; 1993, $111,541,
and such amounts are included in the amounts in column (i) above. Pursuant
to the defined contribution portion of the Supplemental Retirement Savings
Plan, the amounts credited by Coltec for 1995 and 1994 for Mr. Dashnaw were
$19,151 and $6,386, respectively, and such amounts are included in the
amounts in column (i) above. The costs to Coltec for 1995, 1994 and 1993
for whole life insurance, measured by the excess of premiums paid over the
cash surrender value, pursuant to arrangements wherein Coltec is the sole
owner and beneficiary of the insurance policy with an obligation to make
certain payments to a beneficiary over a 15 year period in the event of a
named executive officer's death while employed, for the named executive
officers were as follows: Mr. Guffey, 1995, $20,639; 1994, $19,367; 1993,
$19,367; Mr. Schoen, 1995, $7,764; 1994, $13,764; 1993, $8,152; Mr. Polsky,
1995, $6,699; 1994, $12,715; 1993, $7,103; Mr. Cybulski, 1995, $9,471;
1994, $13,878, and such amounts are included in the amounts in column (i)
above.
(4) Mr. Dashnaw was not an executive officer at any time during 1993 and,
accordingly, information with respect thereto has been omitted.
STOCK OPTIONS
The following table contains information concerning 1995 grants of stock
options under Coltec's 1992 Stock Option and Incentive Plan to the named
executive officers and the potential realizable value of these option grants
based on assumed rates of stock appreciation of 5% and 10% per year over the
10-year term of the options.
OPTION GRANTS IN 1995
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE
INDIVIDUAL GRANTS VALUE AT ASSUMED ANNUAL
- --------------------------------------------------------------------------------------------- RATES OF STOCK
(B) (C) APPRECIATION FOR OPTION
NUMBER OF % OF TOTAL TERM
SECURITIES OPTIONS (D) -------------------------
UNDERLYING GRANTED TO EXERCISE OR
(A) OPTIONS EMPLOYEES IN BASE PRICE (E) (F) (G)
NAME GRANTED(#)(1) 1995 ($/SH) EXPIRATION DATE 5%($) 10%($)
- ------------------------- -------------- -------------- ------------ ----------------- ------------ ----------
<S> <C> <C> <C> <C> <C> <C>
John W. Guffey, Jr....... 550,000 18.6 $10.75 October 30, 2005 $3,718,300 $9,423,000
Paul G. Schoen........... 250,000 8.4 $10.75 October 30, 2005 $1,690,200 $4,283,200
Laurence H. Polsky....... 250,000 8.4 $10.75 October 30, 2005 $1,690,200 $4,283,200
John M. Cybulski......... 160,000 5.4 $10.75 October 30, 2005 $1,081,700 $2,741,200
Richard L. Dashnaw....... 160,000 5.4 $10.75 October 30, 2005 $1,081,700 $2,741,200
</TABLE>
- ------------------------------
(1) The options are nonqualified options exercisable to the extent of 20% of the
total, cumulatively, commencing October 31, 1996 and annually thereafter
until fully exercisable on October 31, 2000. Exercise of an option may be by
cash, negotiable certificates representing whole shares of Coltec Common
Stock (or, subject to the approval of the Compensation Committee, through
withholding of Common Stock which would otherwise have been received upon
exercise of the option) or any combination thereof. The option agreements
contain change-in-control provisions. See "Employment Contracts and
Termination of Employment and Change-In-Control Arrangements" for additional
information.
7
<PAGE>
OPTION EXERCISES AND HOLDINGS
The following table provides information with respect to the named executive
officers concerning the options held as of December 31, 1995 (none of the named
executive officers exercised options during 1995):
AGGREGATED OPTION EXERCISES IN 1995
AND DECEMBER 31, 1995 OPTION VALUES
<TABLE>
<CAPTION>
(C)
(B) -----------------------------
---------------------------
VALUE OF
NUMBER OF SECURITIES UNEXERCISED
UNDERLYING UNEXERCISED IN-THE-MONEY
OPTIONS AT OPTIONS AT
(A) DECEMBER 31, 1995 DECEMBER 31, 1995
- ------------------------- --------------------------- -----------------------------
NAME EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ------------------------- ----------- ------------- ------------ --------------
<S> <C> <C> <C> <C>
John W. Guffey, Jr....... 158,000 732,000 $ -0- $481,250
Paul G. Schoen........... 72,000 318,000 -0- 218,750
Laurence H. Polsky....... 64,000 306,000 -0- 218,750
John M. Cybulski......... 48,000 192,000 -0- 140,000
Richard L. Dashnaw....... 48,000 192,000 -0- 140,000
David I. Margolis........ 180,000 120,000 -0- -0-
</TABLE>
PENSION PLAN
The following table shows the estimated annual pension benefits payable to a
covered participant at normal retirement age (age 65) on a single life annuity
basis under Coltec's qualified defined benefit plan, as well as nonqualified
supplemental pension plans that provide benefits that would otherwise be denied
participants by reason of certain Internal Revenue Code limitations on qualified
plan benefits, based for the most part on five-year average final compensation
(salary and bonus during the 60 highest-paid consecutive months out of the last
120 months) and years of service with Coltec and its subsidiaries and not
subject to deduction for Social Security or other payments:
PENSION PLAN TABLE
<TABLE>
<CAPTION>
YEARS OF SERVICE
FIVE-YEAR AVERAGE ------------------------------------------------------------------
ANNUAL COMPENSATION 10 15 20 25 30 35
- --------------------------- -------- -------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
$ 400,000.................. $ 66,100 $ 99,100 $ 132,100 $ 165,100 $ 198,200 $ 231,200
600,000.................. 100,100 150,100 200,100 250,100 300,200 350,200
800,000.................. 134,100 201,100 268,100 335,100 402,200 469,200
1,000,000................. 168,100 252,100 336,100 420,100 504,200 588,200
1,200,000................. 202,100 303,100 404,100 505,100 606,200 707,200
1,400,000................. 236,100 354,100 472,100 590,100 708,200 826,200
1,600,000................. 270,100 405,100 540,100 675,100 810,200 945,200
1,800,000................. 304,100 456,100 608,100 760,100 912,200 1,064,200
2,000,000................. 338,100 507,100 676,100 845,100 1,014,200 1,183,200
2,200,000................. 372,100 558,100 744,100 930,100 1,116,200 1,302,200
2,400,000................. 406,100 609,100 812,100 1,015,100 1,218,200 1,421,200
2,600,000................. 440,100 660,100 880,100 1,100,100 1,320,200 1,540,200
2,800,000................. 474,100 711,100 948,100 1,185,100 1,422,200 1,659,200
</TABLE>
8
<PAGE>
As of December 31, 1995, the five-year average final compensation (average
compensation of credited service for a participant with less than 60 months of
service) and current years of credited service for each of the following persons
were: Mr. Guffey, $1,140,723 and 17 years (including an additional 7 years of
credited service as an employee of one of Coltec's subsidiary corporations); Mr.
Schoen, $612,810 and 21 years; Mr. Polsky, $539,768 and 4 years; Mr. Cybulski,
$480,030 and 14 years (including 9 years of additional credited service as an
employee of one of Coltec's subsidiaries in Canada); Mr. Dashnaw, $362,410 and 9
years; and Mr. Margolis, who retired in January 1995, $2,620,816 and 32 years.
Compensation covered under the pension plans includes amounts reported in
columns (c) and (d) of the Summary Compensation Table. Coltec has agreed to
calculate Mr. Guffey's pension benefits as if his prior credited service with a
subsidiary were provided under the plan (the benefits of which are set forth in
the above table) with payments to be made to him from the qualified plan,
non-qualified plans and from Coltec. In addition, Coltec has agreed to calculate
Mr. Cybulski's pension benefits as if his prior service earned in a Canadian
subsidiary were earned under the plan (the benefits of which are set forth in
the above table) and will be offset by benefits earned under the Canadian
Pension Plan. Payments will be made to him from the Canadian Pension Plan, the
qualified plan, non-qualified plans and from Coltec.
COMPENSATION OF DIRECTORS
Directors who are not also employees of Coltec receive a retainer at the
annual rate of $25,000 ($30,000 if Chairperson of a Committee) and receive
$1,250 per meeting for attendance at meetings of the Board of Directors and its
committees with a maximum of $2,000 for more than one meeting on the same day
($2,500 if Chairperson of one of the meetings). The Board of Directors of Coltec
has established a retirement age policy which provides that a director shall not
be eligible for nomination to the Board of Directors if such person has attained
the age of 70. In connection therewith, the Board of Directors also established
a pension arrangement for directors who are not entitled to a pension from
Coltec or any subsidiary thereof, with payments for life commencing at the later
of retirement or age 70. The annual amount of such payment is calculated on the
basis of the number of years of service as a director and would equal $10,000
for five years of service plus an additional $2,000 for each additional year of
service up to a maximum annual amount of $20,000.
Payment of director retainer, committee or attendance fees may be deferred
in whole or in part, at the option of a non-employee director, under Coltec's
Deferred Compensation Plan for Non-Employee Directors (the "Deferred
Compensation Plan") adopted by the Board of Directors of Coltec on January 10,
1996. The Deferred Compensation Plan provides that any fees deferred thereunder
shall be credited at the end of each quarter to (i) a share account, which
allows for the purchase of share units that represent shares of Common Stock,
(ii) a cash account, which pays interest at a rate based on the ninety-day
Treasury bill rate over the past twelve months, or (iii) a combination of both.
The amount deferred under the Deferred Compensation Plan will be paid, at the
non-employee director's option, in a lump sum or over a ten-year period
commencing on the first business day of the calendar year following the year
during which the non-employee director ceases to be a director of Coltec.
Pursuant to the 1994 Stock Option Plan for Outside Directors of Coltec
Industries Inc, non-employee directors in 1994 each received an initial grant of
an option to purchase 10,000 shares of Common Stock and will receive subsequent
option grants to purchase 2,000 shares of Common Stock during their service on
the Board of Directors. In April 1995, options to purchase 10,000 shares were
granted to Mr. Coppola at an option exercise price of $18.075 per share
exercisable in five equal annual installments commencing April 27, 1996.
On May 30, 1995, the Board of Directors approved Change in Control
arrangements for non-employee directors who do not continue to serve as a
director of Coltec during any part of the two year period following a Change in
Control for reasons other than voluntary resignation or voluntary choice not to
stand for re-election. Pursuant thereto each such director would receive a lump
sum amount
9
<PAGE>
equal to five times the amount of the director's annual retainer being paid at
the time he or she ceases to be a director and would have five years as a
director added to his or her completed years as a director for purposes of
calculating benefits to be paid pursuant to the pension arrangement for
directors.
During 1995, following Mr. Margolis' retirement in January, Coltec provided
him with secretarial assistance and office services at a cost to Coltec of
approximately $58,000.
EMPLOYMENT CONTRACTS AND TERMINATION OF EMPLOYMENT AND
CHANGE-IN-CONTROL ARRANGEMENTS
All currently outstanding agreements granting restricted stock or stock
options to the named executive officers in the Summary Compensation Table above
contain change-in-control provisions. In the case of the restricted stock, in
the event of a change-in-control, all restrictions on assignment, transfer or
other disposition of the restricted stock lapse. In the case of stock options,
in the event of a change-in-control, the options become fully exercisable or, in
the alternative, the named executive officer may surrender all or part of the
option to Coltec during a one-year period after the change-in-control in
exchange for a cash payment for each option surrendered equal to the excess of
the fair market value of the Common Stock on the date of surrender over the
option price. Fair market value for this purpose equals the last sales price of
the Common Stock on the exercise date on the New York Stock Exchange Composite
Tape (or, if no such sale occurred on such date, the last date preceding such
date on which a sale was reported), except that, in the case of a change of
ownership of more than 35% of the outstanding shares of Common Stock, fair
market value means the amount of cash and fair market value of other
consideration tendered for such outstanding shares.
As of June 1, 1995, Coltec entered into employment agreements with Messrs.
Guffey, Schoen, Polsky, Cybulski and Dashnaw. The agreements expire on May 31,
2000 for Mr. Guffey, on May 31, 1999 for Messrs. Schoen and Polsky and on May
31, 1998 for Messrs. Cybulski and Dashnaw. Compensation payable thereunder is at
salary rates not less than those in effect on June 1, 1995, with participation
in incentive and employee benefit plans at the discretion of the Board of
Directors and the executive's functions, duties and responsibilities are not
subject to change. If during the term of the agreements a Change-in-Control (as
defined in the agreements) occurs and the executive resigns for Good Reason (as
defined in the agreements) which occurs within two years after a Change-in-
Control, the executive is (i) to be paid a lump sum equal to salary plus highest
annual bonus over the prior three years multiplied by five times for Mr. Guffey,
four times for Messrs. Schoen and Polsky and three times for Messrs. Cybulski
and Dashnaw, (ii) to continue participation as an active participant in all
Coltec perquisites as well as benefit plans and fringe benefit programs for a
period of time from the date of termination. Said period of time for Mr. Guffey
is five years, for Messrs. Schoen and Polsky is four years and three years for
Messrs. Cybulski and Dashnaw. Amounts to be paid are to include an additional
tax gross-up covering any excise tax on severance payments. The June 1, 1995
agreements supersede all prior employment agreements.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Mr. Guffey is a director of Giddings & Lewis, Inc. and Mr. Coppola, who is a
member of Coltec's Stock Option and Compensation Committee, is Chairman, Chief
Executive Officer and President of Giddings & Lewis, Inc.
STOCK OPTION AND COMPENSATION COMMITTEE
REPORT ON EXECUTIVE COMPENSATION
The Compensation Committee, whose members are all outside directors of
Coltec, is charged with establishing and monitoring Coltec's executive
compensation program. The Compensation Committee is of the opinion that Coltec's
total compensation program for executives should be competitive
10
<PAGE>
with the market and that each component should reflect both individual and
Coltec performance. In order to ensure that Coltec's total compensation program
meets these objectives, the Compensation Committee meets regularly with a
recognized expert in executive compensation.
Coltec's executive compensation program is designed to reward senior
management for the creation of shareholder value. This is accomplished by
providing annual and longer-term incentives to achieve certain financial goals
tied to business performance that, over time, should result in an increase in
Coltec's stock price. In addition, a substantial portion of each executive's
total compensation is represented by stock options. These stock options only
have value if the stock price increases.
Coltec considers its senior corporate officers, including the named
executive officers listed on the Summary Compensation Table, as a team for
purposes of designing its total compensation program. The Compensation Committee
has implemented this approach by using the same performance criteria to
determine all senior executive incentive compensation awards and basing each
award on the scope of an executive's responsibilities and years of experience in
a given position. Therefore, the discussion below of the determination of Mr.
Guffey's 1995 incentive award is also applicable to the determination of
incentive awards for the other senior corporate officers.
BASE SALARY
Base salaries for senior corporate officers are typically adjusted on an
annual basis within the applicable salary range. The level of an executive's
annual salary adjustment is based on the Compensation Committee's assessment of
the executive's contribution to Coltec's profitability and the median salaries
paid to executives in similar positions at other companies. In determining
competitive salary levels, Coltec relies on published survey data from a number
of recognized surveys covering hundreds of companies including, but not
necessarily limited to, companies in the Standard & Poor's 500 Index and/or The
Dow Jones Industrial Average.
Mr. Guffey's base salary was increased on January 1, 1995 from $534,240 to
$666,360 to reflect his elevation to Chairman and Chief Executive Officer. The
increase reflected the approximate median salary level for other chief executive
officers in companies of similar size, business and complexity as reported in
the published surveys noted above, the experience of Mr. Guffey, and his
contribution to Coltec's overall performance in 1994.
ANNUAL INCENTIVE (BONUS) COMPENSATION
The Annual Incentive Plan (the "Annual Plan") provides for an annual bonus
pool for cash incentive awards for any year equal to 6% of Coltec's operating
profit. No award may be paid in any year to participating executives unless the
operating profit for that year exceeds $100 million. In addition, awards to
either of the two executives with the highest base salaries at the end of a plan
year cannot exceed 20% of the available bonus pool in any one year.
Annual incentive awards are determined by Coltec's annual performance
compared to its historical performance and the performance of other
manufacturing companies included in the FORTUNE 1000 (formerly referred to as
the FORTUNE 500 industrial companies) on the basis of return on assets and
return on capital, two generally accepted measures for evaluating company
business performance. Target bonus levels for participating executives are based
on the same published survey data used to determine base salaries. The
Compensation Committee has established target bonus levels which are payable for
the achievement of corporate performance regarded by the Compensation Committee
to be as good as that of other comparable manufacturing companies. If Coltec's
actual performance exceeds the established target performance level, actual
incentive compensation can significantly exceed individual incentive targets.
Conversely, if actual performance does not meet established targets, actual
incentive compensation can be reduced or eliminated, as warranted.
The level of Mr. Guffey's incentive compensation for 1995 was determined by
comparing Coltec's performance with its historical performance and the
performance of two groups of companies during the first nine months of 1995. The
first "traditional" group consists of a peer group of FORTUNE 1000 manufacturing
companies with comparable business and/or organizational structures. The second
11
<PAGE>
"select" peer group consists of FORTUNE 1000 companies which rank in the top
twenty-five percent of FORTUNE 1000 manufacturing companies in terms of return
on assets, return on equity, return on sales, ten-year average growth rate in
earnings per share, and ten-year average total return to shareholders. Many of
the companies from the traditional and select peer groups are included in the
Standard & Poor's 500 Index and/or The Dow Jones Industrial Average.
Mr. Guffey's incentive compensation reflects Coltec's 1995 performance
compared with that of both peer groups during the first nine months of 1995
based on return on assets and return on capital, the annual financial measures
that the Compensation Committee believes significantly influence shareholder
value. Coltec's results were the highest of all traditional peer group companies
for return on assets and return on capital. Among the select peer group,
Coltec's results were in approximately the top quartile for return on capital
and in the top 15% for return on assets. It is projected that the sum of Mr.
Guffey's 1995 salary plus bonus is comparable to that paid to other peer group
chief executive officers with comparable 1995 financial performance.
Mr. Guffey's 1995 bonus exceeds the bonus he was paid in 1994 when he was
President and Chief Operating Officer. This increase is attributable solely to
the fact that his target bonus is a percentage of base salary which increased
significantly upon his elevation to Chief Executive Officer as of February 1,
1995. Mr. Guffey's 1995 bonus is approximately 13% less than the 1994 bonus paid
to Coltec's chief executive officer in 1994.
LONG-TERM PERFORMANCE PLANS
The objective of Coltec's long-term compensation program is to measure and
reward senior corporate officers for the achievement of longer-term business
goals linked to the increase in shareholder value. This program consists of the
1992 Stock Option and Incentive Plan (the "Option Plan") and the 1994 Long-Term
Incentive Plan (the "1994 Incentive Plan").
The Option Plan provides for grants of stock options at an exercise price
equal to the market price of the Common Stock on the date of grant. This plan
ties awards directly to the growth in shareholder value by linking option
recipient gains to Common Stock price increases above the exercise price. It is
the Compensation Committee's general policy to make stock option grants to an
executive once every four years, and more frequently to reflect the assignment
of increased responsibilities. Consistent with this policy, stock options were
granted to the named executive officers and other executives on October 31,
1995. The number of option shares granted to each executive was consistent with
Coltec's prior practice and with competitive practices of companies similar to
Coltec for executives with like responsibilities.
The 1994 Incentive Plan replaced the 1977 Long-Term Performance Plan. Both
the 1994 Incentive Plan and its predecessor plan were designed to focus Coltec's
senior corporate and divisional executives on certain financial goals deemed
essential for Coltec's long-term profitability and continued increase in
shareholder value, but which may not be directly tied to short-term increases in
the market value of Coltec's Common Stock.
The 1994 Incentive Plan provides for annual grants of performance units
("Units") to senior corporate executives of Coltec and its subsidiaries who are
selected by the Compensation Committee. Amounts paid under the 1994 Incentive
Plan qualify as "performance-based" compensation which is excludable from the $1
million executive compensation deduction limit passed by Congress in 1993.
The value of each Unit is determined on the basis of Coltec's cumulative
operating profit measured over a three-year performance cycle. The 1994
Incentive Plan provides that no more than 300,000 Units may be awarded for any
performance cycle and that no more than 50,000 Units may be awarded to any
participant in a given cycle. For the 1995 performance cycle, Mr. Guffey
received an additional 10,000 Units to reflect his new responsibilities as
Chairman and Chief Executive Officer which brings his total Units to the level
established for this position.
12
<PAGE>
For each three-year performance cycle, the threshold level for cumulative
operating profit is $600 million. If that operating profit is achieved, each
Unit will have an award value of $12 and will increase by $.0333 for each $1
million that cumulative operating profit for the award cycle exceeds $600
million, except that for the performance cycle commencing January 1, 1994 only,
awards had a value of $36 at $600 million of cumulative operating profit and
will increase by $.10 for each $1 million of operating profit above the $600
million threshold. The 1994 performance cycle award values were transitional and
were intended to replace the incentive opportunity lost for the years 1994 and
1995 as a result of the replacement of the 1977 Long-Term Performance Plan with
the 1994 Incentive Plan. There is no maximum limit on the award value that can
be earned per Unit. No amounts are payable for a Unit if cumulative operating
profit for a performance cycle is less than $600 million.
Awards are paid two-thirds in cash and one-third in Common Stock that vests
in equal installments over three years thus continuing to tie the ultimate value
received by the executive to shareholder value. To encourage additional
executive stock ownership, executives electing to receive an additional part of
an earned award in Common Stock will receive Common Stock with a value which is
15% greater than the foregone cash award. No more than .5% (1% in 1997) of the
issued and outstanding Common Stock may be awarded under the 1994 Incentive Plan
in any year.
Coltec also maintains certain benefit programs in which the executive group
participates. The compensation attributed to the named executive officers for
1995 from these programs is detailed in this proxy statement. (See Column (I)
entitled "All Other Compensation" on the Summary Compensation Table). The
Compensation Committee believes that the level of benefits received by Mr.
Guffey for participation in these programs reflects the levels received by
comparable executives in similar organizations.
In June 1995, Coltec entered into employment agreements with Messrs. Guffey,
Schoen, Polsky, Cybulski and Dashnaw. These agreements provide for salaries not
less than those in effect on June 1, 1995 and contain Change-in-Control
arrangements. The agreements have expiration dates of five years for Mr. Guffey,
four years for Messrs. Schoen and Polsky and three years for Messrs. Cybulski
and Dashnaw and supersede prior agreements with expiration dates for Messrs.
Guffey, Schoen and Polsky of July 1, 1996. The members of the Compensation
Committee, as a majority of the members of the Board of Directors of Coltec,
approved the agreements primarily to assure continued service to Coltec by the
executives and to afford protection to them in the event of a Change-in-Control.
During 1993, Congress enacted legislation that could limit the deductibility
of compensation paid to Coltec's named executive officers. This legislation
provides that compensation paid to any one executive in excess of $1 million
will not be deductible unless the compensation falls into certain exemptions or
is paid under a shareholder approved plan and qualifies as "performance-based"
compensation.
The Compensation Committee believes that the annual incentive awards and the
long-term compensation program components of Coltec's executive compensation
program are "performance-based" and that the process by which compensation
levels are determined and payments are made is sound and should be continued. In
1994, shareholders approved amendments to the Annual Plan, the Option Plan, and
adopted the 1994 Incentive Plan. As a result of these shareholder actions, the
Compensation Committee believes that incentive payments made to the named
executive officers under Coltec's incentive compensation plans meet the Internal
Revenue Service requirements for "performance-based" compensation.
Joel Moses, Chairman
Joseph R. Coppola
J. Bradford Mooney, Jr.
Richard A. Stuckey
13
<PAGE>
PERFORMANCE GRAPH
The following is a line graph presentation comparing Coltec's cumulative
total shareholder return on the Common Stock with the Standard & Poor's 500
Index and The Dow Jones Industrial Average for the period since March 25, 1992,
the date when trading began in connection with the initial public offering on
April 1, 1992 to December 29, 1995 (assuming an investment of $100 in each on
April 1, 1992):
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
COLTEC INDUSTRIES DOW JONES INDUSTRIAL S&P 500
<S> <C> <C> <C>
3/24/92 100 100 100
12/31/92 128 104 109
12/31/93 125 121 120
12/31/94 114 127 122
12/31/95 78 174 167
</TABLE>
PROPOSAL 2 -- RATIFICATION OF APPOINTMENT OF AUDITORS
The Board of Directors has appointed Arthur Andersen LLP, independent public
accountants, as the auditors of Coltec, to serve at the pleasure of the Board of
Directors for 1996. A member of that firm will be present at the Annual Meeting
with the opportunity to make a statement and respond to appropriate questions by
shareholders.
The shareholders of Coltec are asked to consider and act upon the matter of
ratifying the appointment of Arthur Andersen LLP. Approval of this Proposal 2 by
the shareholders will require the affirmative votes of the holders of a majority
of the shares of Common Stock voting at the meeting (assuming a quorum is
present). The Board of Directors recommends approval of this Proposal 2. All
proxies will be voted in accordance with instructions contained thereon. If no
specific instructions are given, the persons named as proxies in the
accompanying form will vote FOR Proposal 2.
OTHER MATTERS
In addition to the use of the mails, proxies may be solicited, at the
expense of Coltec, by employees and directors of Coltec personally or by
telephone, facsimile transmission, telegram or other means of communication. In
addition, Kissel-Blake Inc. has been retained by Coltec as soliciting agent and
will
14
<PAGE>
be paid a fee of $5,500 by Coltec for this service. Coltec will reimburse
brokerage firms, banks, trustees, nominees and other persons for their
out-of-pocket expenses in forwarding proxy material to beneficial owners of
Common Stock.
As of the date of this Proxy Statement, management has no knowledge of any
business other than that described herein that will be presented for
consideration at the meeting. In the event any other business is presented at
the meeting, it is intended that the persons named in the enclosed proxy will
have authority to vote such proxy in accordance with their judgment on such
business.
SHAREHOLDER PROPOSALS
Shareholder proposals intended to be presented at the 1997 Annual Meeting of
Shareholders must be received by November 30, 1996, by the Secretary of Coltec
(at the address set forth on page one of this Proxy Statement) for inclusion in
the Proxy Statement and form of proxy relating to that meeting.
ANNUAL REPORTS
Coltec's 1995 Annual Report to Shareholders, which contains financial
statements for the year ended December 31, 1995, accompanies this Proxy
Statement. Coltec's Annual Report on Form 10-K for its fiscal year ended
December 31, 1995, will be made available (without exhibits), free of charge, to
interested shareholders upon written request to the Secretary of Coltec (at the
address set forth on page one of this Proxy Statement).
By order of the Board of Directors
John W. Guffey, Jr.
CHAIRMAN OF THE BOARD, PRESIDENT
AND CHIEF EXECUTIVE OFFICER
New York, New York
March 22, 1996
YOUR VOTE IS IMPORTANT.
TO VOTE YOUR SHARES, PLEASE MARK, SIGN AND DATE THE ENCLOSED PROXY CARD
AND MAIL IT PROMPTLY IN THE ENCLOSED POSTAGE-PAID RETURN ENVELOPE.
15
<PAGE>
CONFIDENTIAL VOTING INSTRUCTIONS
______________
Common Stock
The shares to which these instructions relate will be voted as directed. If no
direction is given when the duly executed instructions are returned, the shares
will be voted in the same proportion as instructions are received for shares
credited to the accounts of participants in the Walbar Savings Plan.
PLEASE MARK YOUR CHOICE LIKE THIS: /X/ IN BLUE OR BLACK INK
The undersigned hereby instructs the Trustees of the Walbar Stock Fund
of the Walbar Savings Plan, to vote all stock of Coltec Industries Inc credited
to my account in the Walbar Stock Fund of the Walbar Savings Plan at the annual
meeting of shareholders of Coltec Industries Inc to be held at 10:00 a.m., local
time, on Wednesday, May 1, 1996, at the Des Moines Marriott Hotel, 700 Grand
Avenue, Des Moines, Iowa, and at any adjournment or adjournments thereof, on the
items of business set forth below and on such other business as may properly
come before the meeting.
PROPOSAL 1 - Election of the following nominees as Directors: Joseph R.
Coppola, John W. Guffey, Jr., David I. Margolis, J. Bradford
Mooney, Jr., Joel Moses, Paul G. Schoen and Richard A. Stuckey.
- --------------------------------------------------------------------------------
<PAGE>
Instructions to vote FOR the nominees includes discretionary authority to vote
for a substitute nominee if any of the nominees listed becomes unable or
unwilling to serve.
<TABLE>
<S> <C> <C>
FOR ALL NOMINEES STANDING FOR ELECTION / / WITHHELD FOR ALL NOMINEES / / Withheld for the follow-
ing only (write the name of
the nominee(s) in the space
below)
____________________________
PROPOSAL 2 - Appointment of Independent Public
Accountants
FOR AGAINST ABSTAIN
/ / / / / /
DATE:
---------------------------------
SIGNATURE:
----------------------------
</TABLE>
<PAGE>
CONFIDENTIAL VOTING INSTRUCTIONS
______________
Common Stock
The shares to which these instructions relate will be voted as directed. If no
direction is given when the duly executed instructions are returned, the shares
will be voted in the same proportion as instructions are received for shares
credited to the accounts of participants in the Walbar Canada Inc. Employee
Savings and Profit Sharing Plan.
PLEASE MARK YOUR CHOICE LIKE THIS: /X/ IN BLUE OR BLACK INK
The undersigned hereby instructs the Trustees of the Walbar Canada Inc.
Employee Savings and Profit Sharing Plan, to vote all stock of Coltec Industries
Inc credited to my account in the Walbar Canada Inc. Employee Savings and Profit
Sharing Plan at the annual meeting of shareholders of Coltec Industries Inc to
be held at 10:00 a.m., local time, on Wednesday, May 1, 1996, at the Des Moines
Marriott Hotel, 700 Grand Avenue, Des Moines, Iowa, and at any adjournment or
adjournments thereof, on the items of business set forth below and on such other
business as may properly come before the meeting.
PROPOSAL 1 - Election of the following nominees as Directors: Joseph R.
Coppola, John W. Guffey, Jr., David I. Margolis, J. Bradford
Mooney, Jr., Joel Moses, Paul G. Schoen and Richard A. Stuckey.
- --------------------------------------------------------------------------------
<PAGE>
Instructions to vote FOR the nominees includes discretionary authority to vote
for a substitute nominee if any of the nominees listed becomes unable or
unwilling to serve.
<TABLE>
<S> <C> <C>
FOR ALL NOMINEES STANDING FOR ELECTION / / WITHHELD FOR ALL NOMINEES / / Withheld for the follow-
ing only (write the name of
the nominee(s) in the space
below)
____________________________
PROPOSAL 2 - Appointment of Independent Public
Accountants
FOR AGAINST ABSTAIN
/ / / / / /
DATE:
---------------------------------
SIGNATURE:
----------------------------
</TABLE>
<PAGE>
COLTEC INDUSTRIES COLTEC INDUSTRIES INC
430 PARK AVENUE
NEW YORK, NEW YORK
THIS PROXY IS SOLICITED
ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints JOHN W. GUFFEY, JR., and PAUL G. SCHOEN, and
each of them, with full power of substitution, as proxy or proxies to vote all
stock of Coltec Industries Inc owned by the undersigned, with like effect as
if the undersigned were personally present and voting at the annual meeting of
shareholders of Coltec Industries Inc to be held at 10:00 a.m., local time, on
Wednesday, May 1, 1996, at the Des Moines Marriott Hotel, 700 Grand Avenue,
Des Moines, Iowa, and at any adjournment or adjournments thereof, on the
items of business set forth on the reverse side hereof and on such other
business as may properly come before the meeting and hereby revokes any proxy or
proxies heretofore given.
THIS PROXY IS CONTINUED ON THE REVERSE SIDE.
PLEASE SIGN ON THE REVERSE SIDE AND RETURN PROMPTLY.
<PAGE>
PLEASE MARK YOUR VOTES AS INDICATED IN THIS EXAMPLE /X/
THE SHARES REPRESENTED BY THIS PROXY WILL BE VOTED AS DIRECTED BY THE
SHAREHOLDER. IF NO DIRECTION IS GIVEN WHEN THE DULY EXECUTED PROXY IS RETURNED,
SUCH SHARES WILL BE VOTED "FOR" THE NOMINEES IN PROPOSAL 1 AND "FOR" PROPOSAL 2.
COMMON
The Board of Directors recommends a vote "FOR" the nominees in Proposal 1 and
"FOR" Proposal 2.
Proposal 1 - Election of the following nominees as Directors:
Joseph R. Coppola Joel Moses
John W. Guffey, Jr. Paul G. Schoen
David I. Margolis Richard A. Stuckey
J. Bradford Mooney, Jr.
FOR ALL NOMINEES STANDING FOR ELECTION. / /
WITHHELD FOR ALL / /
A VOTE FOR THE NOMINEES INCLUDES DISCRETIONARY AUTHORITY TO VOTE FOR A
SUBSTITUTE NOMINEE IF ANY OF THE NOMINEES LISTED BECOMES UNABLE OR UNWILLING TO
SERVE.
Withhold for the following only
(Write the name of the nominee(s) in the space below)
- ----------------------------------------------------------
Proposal 2 - Appointment of Independent Public Accountants
FOR / /
AGAINST / /
ABSTAIN / /
Dated: , 1996
--------------------------
Signature(s)
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Note: Please sign as name appears above. Joint owners should each sign. When
signing as attorney, executor, administrator, trustee or guardian, please give
full title.
