<PAGE> 1
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SCHEDULE 14A
(RULE 14a)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934
(AMENDMENT NO. )
Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:
<TABLE>
<S> <C>
/ / Preliminary Proxy Statement / / CONFIDENTIAL, FOR USE OF THE COMMISSION
ONLY (AS PERMITTED BY RULE 14A-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to sec.240.14a-11(c) or sec.240.14a-12
</TABLE>
LIQUI-BOX CORPORATION
(NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
(NAME OF PERSON(S) FILING PROXY STATEMENT, IF OTHER THAN THE REGISTRANT)
Payment of filing fee (Check the appropriate box):
/X/ $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:_______________
- --------------------------------------------------------------------------------
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<PAGE> 2
LIQUI-BOX CORPORATION
POST OFFICE BOX 494
WORTHINGTON, OHIO 43085-0494
TELEPHONE: (614) 888-9280
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To the Shareholders of
LIQUI-BOX CORPORATION:
NOTICE IS HEREBY GIVEN that the Annual Meeting of Shareholders (the "Annual
Meeting") of Liqui-Box Corporation ("Liqui-Box") will be held at the Columbus
Marriott North, 6500 Doubletree Avenue, Columbus, Ohio, on Wednesday, April 24,
1996, at 9:00 a.m. (local time) for the following purposes:
1. To elect three (3) directors to serve for terms of two years each.
2. To transact such other business as may properly come before the
Annual Meeting or any adjournment or adjournment(s) thereof.
A copy of the Annual Report for the 1995 fiscal year accompanies this
Notice.
By Order of the Board of Directors,
Peter J. Linn
Secretary
Dated: March 18, 1996
WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING, PLEASE FILL IN, SIGN, DATE
AND RETURN THE ACCOMPANYING PROXY IN THE ENCLOSED ENVELOPE, TO WHICH NO POSTAGE
NEED BE AFFIXED IF MAILED IN THE UNITED STATES.
<PAGE> 3
LIQUI-BOX CORPORATION
POST OFFICE BOX 494
WORTHINGTON, OHIO 43085-0494
TELEPHONE: (614) 888-9280
PROXY STATEMENT
GENERAL
This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Directors of Liqui-Box Corporation ("Liqui-Box") to be
used at its Annual Meeting of Shareholders (the "Annual Meeting") to be held on
April 24, 1996, and at any adjournment(s) thereof. Common shares represented by
properly executed proxies will be voted at the Annual Meeting. Where a choice is
specified by the shareholder, the proxy will be voted in accordance with such
choice. Any proxy may be revoked at any time insofar as it has not been
exercised provided notice of revocation of the proxy is received by Liqui-Box
either in writing or in open meeting.
This Proxy Statement was first mailed to shareholders on or about March 18,
1996.
February 26, 1996, has been fixed as the record date for the determination
of shareholders entitled to notice of and to vote at the Annual Meeting or any
adjournment(s) thereof. On the record date, 6,117,606 common shares of Liqui-Box
were outstanding and entitled to vote. The holders of common shares entitling
them to exercise a majority of the voting power of Liqui-Box will constitute a
quorum for the Annual Meeting.
Under the rules of the Securities and Exchange Commission (the "SEC"),
boxes and a designated blank space are provided on the form of proxy for
shareholders to mark if they wish either to abstain on a proposal presented for
shareholder approval or to withhold authority to vote for one or more nominees
for election as a director of Liqui-Box. Common shares as to which the authority
to vote is withheld will be counted for quorum purposes but will not be counted
toward the election of directors or toward the election of the individual
nominees specified on the form of proxy.
Brokers/dealers, who hold their customers' common shares in street name,
may, under the applicable rules of the self-regulatory organizations of which
the brokers/dealers are members, sign and submit proxies for such common shares
and may vote such common shares on routine matters, which, under such rules,
typically include the election of directors, but brokers/dealers may not vote
such common shares on other matters, which typically include amendments to the
articles or regulations of a corporation, without specific instructions from the
customer who owns such common shares. Proxies signed and submitted by
brokers/dealers which have not been voted on certain matters as described in the
previous sentence are referred to as "broker non-votes". Such proxies count
towards the establishment of a quorum.
Each shareholder is entitled to one vote for each common share held and has
cumulative voting rights in the election of directors. A shareholder wishing to
exercise cumulative voting must so notify the President, a Vice President or the
Secretary of Liqui-Box in writing not less than forty-eight hours before the
Annual Meeting. If cumulative voting is requested, each shareholder will have a
number of votes equal to the number of directors to be elected multiplied by the
number of common shares owned by him and will be entitled to distribute his
votes among the nominees as he sees fit. If cumulative voting is requested, as
described above, the enclosed proxy would grant discretionary authority to the
proxies named therein to cumulate votes and to distribute the votes among the
candidates.
<PAGE> 4
PRINCIPAL HOLDERS OF SECURITIES
The following table sets forth, as of February 26, 1996 (except as
otherwise indicated), certain information concerning the beneficial ownership of
Liqui-Box's common shares by the only persons known to Liqui-Box to own
beneficially more than five percent (5%) of the outstanding common shares of
Liqui-Box.
<TABLE>
<CAPTION>
COMMON SHARES OF LIQUI-BOX
BENEFICIALLY OWNED (1)(2)
NAME AND ADDRESS ----------------------------------
OF BENEFICIAL OWNER AMOUNT % OF TOTAL (3)
- ------------------------------------- --------- --------------
<S> <C> <C>
Samuel B. Davis 967,649(4) 15.7%
6950 Worthington-Galena Road
P. O. Box 494
Worthington, Ohio 43085
Jeanette A. Davis 621,981(5) 10.1%
6950 Worthington-Galena Road
P. O. Box 494
Worthington, Ohio 43085
Fiduciary Management, Inc. 332,627(6) 5.4%
225 East Mason Street
Milwaukee, Wisconsin 53202
</TABLE>
- ---------------
(1) As of February 26, 1996, except as otherwise indicated.
(2) Sole voting and investment power, unless otherwise indicated.
(3) The percent of total is based upon the sum of common shares outstanding on
February 26, 1996 and the number of common shares, if any, as to which the
named person has the right to acquire beneficial ownership upon the exercise
of presently exercisable options.
(4) Includes 11,859 common shares subject to presently exercisable options and
56,959 common shares held for the account of Mr. Davis in the Liqui-Box
Corporation Employee Stock Ownership Plan (the "Liqui-Box ESOP").
Supplemental Retirement Discounted Options become exercisable upon
termination of employment. See footnote (2) to the table under "OPTIONS
GRANTED IN THE LAST FISCAL YEAR." Under the rules of the SEC, options which
become exercisable during the next 60 days are deemed to be presently
exercisable options. For purposes of determining presently exercisable
options, it is assumed that Mr. Davis will not terminate his employment with
Liqui-Box during the next 60 days. Also includes 127,027 common shares
deposited with Mr. Davis in his capacity as voting trustee of a trust which
expires on September 29, 2003. Mr. Davis exercises sole voting power, but
has no investment power, with respect to the common shares deposited in the
Trust. Mr. Davis holds the right of first refusal on the disposal of these
shares.
(5) Includes 130,179 common shares held of record by JASAM Foundation ("JASAM")
as to which Mrs. Davis, as one of four trustees of JASAM, has shared voting
and investment power. The Code of Regulations of JASAM requires the approval
of three of the four trustees to vote or dispose of the common shares held
by JASAM or to take any other action with respect to such common shares.
(6) Based on information contained in filings with the SEC dated February 1,
1996, Fiduciary Management, Inc., a registered investment adviser
("Fiduciary"), may be deemed to have sole investment power with respect to
243,827 common shares and shared investment power with respect to 88,800
common shares. Fiduciary does not have voting power with respect to any of
these common shares.
2
<PAGE> 5
The following table sets forth, as of February 26, 1996, certain
information with respect to Liqui-Box's common shares owned beneficially by each
director of Liqui-Box, each nominee for election as a director of Liqui-Box,
each executive officer of Liqui-Box named in the SUMMARY COMPENSATION TABLE and
by all current directors and executive officers of Liqui-Box as a group:
<TABLE>
<CAPTION>
COMMON SHARES OF LIQUI-BOX
BENEFICIALLY OWNED (1)(2)(3)
NAME OF ---------------------------------------
BENEFICIAL OWNER AMOUNT % OF TOTAL (4)
- ---------------------------------------- --------- --------------
<S> <C> <C>
Samuel B. Davis 967,649(5) 15.7%
Jeanette A. Davis 621,981(6) 10.1%
Robert S. Hamilton 123,530(7)(8) 2.0%
Peter J. Linn 59,838(9) 1.0%
C. William McBee 1,476(10) 0.0%
Russell M. Gertmenian 800 0.0%
Carl J. Aschinger, Jr. 486 0.0%
Juan Jose Perez 0 0.0%
All current directors and executive
officers as a group (8 persons) 1,775,760(11) 28.9%
</TABLE>
- ---------------
(1) As of February 26, 1996.
(2) Sole voting and investment power, unless otherwise indicated.
(3) Supplemental Retirement Discounted Options become exercisable upon
termination of employment. See footnote (2) to the table under "OPTIONS
GRANTED IN THE LAST FISCAL YEAR." Under SEC rules, options which become
exercisable during the next 60 days are deemed to be presently exercisable
options. For purposes of determining presently exercisable options, it is
assumed that no current executive officer will terminate his employment
with Liqui-Box during the next 60 days.
(4) See footnote (3) to the preceding table.
(5) See footnote (4) to the preceding table.
(6) See footnote (5) to the preceding table.
(7) Does not include 4,746 common shares as to which his wife has sole voting
and investment power.
(8) Includes 1,388 common shares held for his account in the Liqui-Box ESOP.
(9) Includes 18,812 common shares subject to presently exercisable options and
16,864 common shares held for his account in the Liqui-Box ESOP.
(10) Includes 476 common shares subject to presently exercisable options.
(11) Includes, as to all current directors and executive officers of Liqui-Box
as a group, 31,147 common shares subject to presently exercisable options
and 75,191 common shares held for their respective accounts in the
Liqui-Box ESOP.
To the knowledge of Liqui-Box, based solely on a review of copies of the
reports furnished to Liqui-Box and written representations that no other reports
were required during the 1995 fiscal year, all filing requirements applicable to
officers, directors and beneficial owners of more than 10% of the outstanding
common shares of Liqui-Box under Section 16(a) of the Securities Exchange Act of
1934, as amended (the "Exchange Act"), were complied with; except that Mr. John
A. Maginnis, a former executive officer and director, filed one report late
covering one transaction; Mr. C. William McBee, an executive officer and
director, filed one report late covering two transactions; and Mr. Juan Jose
Perez, an executive officer, filed one report late reporting an option which he
held at the time he became an executive officer.
3
<PAGE> 6
ELECTION OF DIRECTORS
At the Annual Meeting, three (3) directors will be elected to hold office
until the 1998 Annual Meeting of Shareholders and until their respective
successors are elected and qualified. It is the intention of the persons named
in the accompanying form of proxy to vote the common shares represented by such
proxy for the election of the persons named in the following table unless the
proxy is marked otherwise. In case any person named in the table is unable to
serve or is unwilling to accept nomination or election (which is not
anticipated), the persons named in the proxy will vote the common shares
represented by such proxy for one or more substitute nominees designated by the
present Board of Directors. Under Ohio law and Liqui-Box's Code of Regulations,
the three nominees for election as directors in the class whose terms expire in
1998 receiving the greatest number of votes will be elected as directors.
The following individuals have been nominated for election to the class of
directors whose terms expire in 1998:
<TABLE>
<CAPTION>
NAME, AGE, POSITIONS AND OFFICES WITH
YEAR LIQUI-BOX LIQUI-BOX, PRINCIPAL OCCUPATION
DIRECTORSHIP COMMENCED AND OTHER DIRECTORSHIPS
- ----------------------- ----------------------------------------------------------------------
<S> <C>
Samuel B. Davis Chairman, Chief Executive Officer, President and Treasurer of
54-1977 Liqui-Box
Robert S. Hamilton Vice Chairman of Liqui-Box; Director of Lancaster Colony Corporation
Over 65-1984
Russell M. Gertmenian Partner, Vorys, Sater, Seymour and Pease; Director of Liqui-Box
48-1995
</TABLE>
The following directors will continue to serve after the Annual Meeting
until the 1997 Annual Meeting of Shareholders:
<TABLE>
<CAPTION>
NAME, AGE, POSITIONS AND OFFICES WITH
YEAR LIQUI-BOX LIQUI-BOX, PRINCIPAL OCCUPATION
DIRECTORSHIP COMMENCED AND OTHER DIRECTORSHIPS
- ----------------------- ----------------------------------------------------------------------
<S> <C>
Jeanette A. Davis Director of Liqui-Box; Trustee of JASAM Foundation, a private
Over 65-1985 foundation in Columbus, Ohio; One of the original founders of The
Corrugated Container Co., the precursor to Liqui-Box Corporation
Carl J. Aschinger, Jr. Director of Liqui-Box; Chairman and Chief Executive Officer of The
57-1985 Columbus Showcase Company, a manufacturer of retail and bakery deli
showcases in Columbus, Ohio
Peter J. Linn Secretary and Director of Liqui-Box
54-1984
C. William McBee Vice President, Manufacturing and Director of Liqui-Box
53-1995
</TABLE>
Messrs. Davis, Hamilton and Linn have held various offices with Liqui-Box
during the past five years. Mr. McBee has been a Vice President of Liqui-Box
since February, 1994. Prior to February, 1994, Mr. McBee was the General Manager
for Stone Container Corporation, Columbus, Indiana, a manufacturer of corrugated
cardboard containers. Each other director and nominee for election as a director
has had the same principal occupation for the past five years.
Russell M. Gertmenian, a director of Liqui-Box, is a partner in the law
firm of Vorys, Sater, Seymour and Pease which rendered legal services to
Liqui-Box during the 1995 fiscal year and continues to render legal services to
Liqui-Box during the 1996 fiscal year.
Jeanette A. Davis is the mother of Samuel B. Davis.
During 1995, there were two meetings of Liqui-Box's Board of Directors.
Each incumbent director attended 100% of the aggregate of the total number of
meetings held by the Board of Directors during the
4
<PAGE> 7
period he or she served and the total number of meetings held by all committees
of the Board of Directors on which he or she served during the period he or she
served.
Liqui-Box has an Audit Committee consisting of Carl J. Aschinger, Jr.,
Jeanette A. Davis and Robert S. Hamilton. The Audit Committee met one time
during 1995. Its function is to review the adequacy of Liqui-Box's system of
internal control, to investigate the scope and adequacy of the work of
Liqui-Box's auditors and to recommend to the directors a firm to serve as
Liqui-Box's auditors.
Liqui-Box does not have a compensation committee or a nominating committee
separate from the Board as a whole.
REPORT OF THE BOARD OF DIRECTORS AND STOCK OPTION COMMITTEE
ON EXECUTIVE COMPENSATION
Notwithstanding anything to the contrary set forth in any of Liqui-Box's
previous filings under the Securities Act of 1933, as amended, or the Exchange
Act that might incorporate future filings, including this Proxy Statement, in
whole or in part, this Report and the graph set forth on page 11 shall not be
incorporated by reference into any such filings.
Decisions on compensation of Liqui-Box's executive officers are made by the
Board of Directors, except that decisions on stock option compensation are made
by the Stock Option Committee. Set forth below is a report of the Board
addressing Liqui-Box's compensation policies as they affect Samuel B. Davis, the
Chief Executive Officer (CEO), Robert S. Hamilton, Peter J. Linn, C. William
McBee and Juan Jose Perez, the other current executive officers of Liqui-Box,
and John A. Maginnis, who was an executive officer of Liqui-Box until his
resignation effective as of August 4, 1995.
COMPENSATION PRINCIPLES
Liqui-Box's executive compensation program has existed in its present form
for approximately ten years and consists of base salary, a bonus based on pretax
profits payable under the Liqui-Box Corporation Profit Participation Plan (the
"Liqui-Box PPP"), contributions to various savings and stock ownership programs
and stock options.
Liqui-Box recognizes the need for executive compensation to be directly
reflective of corporate performance. As such, the philosophy has been for many
years, and continues to be, that base salary should constitute a small portion
of the executive officer's total compensation package with the largest portion
of his compensation being based on an allocated percentage of pretax profits
under the Liqui-Box PPP. This practice applies to the majority of Liqui-Box
employees, with the exception that, at lower levels of responsibility, a greater
portion of compensation is base salary with less of the employees' total
compensation being tied to profit.
Under the Liqui-Box PPP, pretax profits are calculated quarterly for the
first three quarters and are estimated in December for the fourth quarter.
Liqui-Box applies a fixed percentage to each quarter's pretax profit to come up
with an allocation to be distributed among all the eligible employees in the
form of a quarterly bonus. This allocation is further broken down to distribute
a greater fixed percentage to those employees who have a more direct impact on
corporate profits (CEO, officers, managers) and a smaller fixed percentage to
those employees who have a less direct impact on profits. Each employee's share
of the pool is further impacted by the number of employees in the overall bonus
pool in any year.
If Liqui-Box's pretax profits increase, the allocation of pretax profit
dollars to compensation increases. If pretax profits decrease, so does the
allocation of pretax profit dollars to compensation. This directly impacts
compensation of executive officers, as well as all other eligible employees.
The Board believes that this type of compensation has attracted, and
continues to attract, the type of executive officers and employees that are
critical to the long term success of Liqui-Box. The Board also believes that
this type of compensation has led, and will continue to lead, to the solid
growth of Liqui-Box while rewarding executive officers and employees for their
joint effort to improve profitability.
5
<PAGE> 8
Since 1992, stock option grants have been used to create long term
incentives to continue the growth in shareholder value. In that year, the Stock
Option Committee adopted guidelines for annual option grants under the 1990
Liqui-Box Corporation Stock Option Plan. The guidelines call for annual grants
of non-qualified options. The number of non-qualified options to be granted each
year is based on a percentage of each executive officer's eligible compensation
and the exercise price of the options is 100% of the fair market value of the
common shares of Liqui-Box on the date of grant. In addition, the guidelines
provide for annual grants of Supplemental Retirement Discounted Options which
are exercisable only upon termination of employment. The Supplemental Retirement
Discounted Options are intended to encourage executive officers to remain in the
employ of Liqui-Box until retirement. See footnote (1) to the table under
"OPTIONS GRANTED IN THE LAST FISCAL YEAR." The number of Supplemental Retirement
Discounted Options to be granted each year is based on an actuarial formula
designed to yield post retirement income equal to a percentage of each executive
officer's average compensation over the last five years of his employment by
Liqui-Box. The Stock Option Committee believes option grants in accordance with
these guidelines will accomplish the objective of linking the compensation of
executive officers to increases in shareholder wealth as reflected in the market
price of the common shares.
In addition to the stock option grants made in accordance with the
guidelines described in the preceding paragraph, at the end of the third fiscal
quarter, the Stock Option Committee felt it was important this year to
reemphasize to the executive officers the need to increase shareholder wealth.
Accordingly, in October 1995, the Committee granted options to Messrs. Davis,
Hamilton, McBee and Perez based on its subjective determination of the relative
current and future contribution that each of them has or may make to the future
long-term welfare of the Company.
Section 162(m) of the Internal Revenue Code of 1986, as amended, prohibits
a publicly-held corporation, such as Liqui-Box, from claiming a deduction on its
federal income tax return for compensation in excess of $1 million paid for a
given fiscal year to the chief executive officer (or person acting in that
capacity) at the close of the corporation's fiscal year and the four most highly
compensated officers of the corporation, other than the chief executive officer,
at the end of the corporation's fiscal year. The $1 million compensation
deduction limitation does not apply to "performance-based compensation." The
Internal Revenue Service issued final regulations on December 19, 1995, which
give some guidance to publicly-held corporations about how to qualify
compensatory plans to meet the "performance-based compensation" requirements.
Liqui-Box has determined that it is not necessary to modify the Liqui-Box
Corporation 1990 Stock Option Plan at this time since compensation which may be
deemed to have been paid to executive officers covered by Section 162(m) under
that Plan would be considered "performance-based" under the transition
provisions of Section 162(m) and the final regulations.
Liqui-Box does not have a policy that requires all compensation payable in
1995 and thereafter to the covered executive officers to be deductible under
Section 162(m). Whenever possible, without distorting or discouraging incentives
for performance that enhance the value of Liqui-Box, Liqui-Box will endeavor to
cause such compensation to be structured so that all of it will be tax
deductible. In all cases, however, whether or not some portion of a covered
executive officer's compensation is tax deductible, Liqui-Box will continue to
carefully consider the net cost and value to Liqui-Box of its compensation
policies.
COMPANY PERFORMANCE AND CEO COMPENSATION
As indicated above, Liqui-Box's executive compensation program is based, in
large part, upon business performance. This pay-for-performance program is
exemplified in the compensation of the CEO.
The Board, has believed, since the mid-1980s when the present executive
compensation program was approved, and continues to believe that Mr. Davis' base
salary of $70,000, which has been unchanged for approximately five years, is
substantially below the base salaries of CEO's in the peer group included in the
performance graph.
Approximately 92.0% of Mr. Davis' cash compensation for 1995 was paid in
the form of a cash bonus under the Liqui-Box PPP. The amount of this bonus is
directly tied to the pretax profits of Liqui-Box. Had
6
<PAGE> 9
Liqui-Box failed to make a profit, Mr. Davis, as well as most of the other
employees, would have received no bonus under the Liqui-Box PPP.
Mr. Davis, along with most other executive officers of Liqui-Box, was
granted options during the Fall of 1995 in accordance with the guidelines which
had been established by the Stock Option Committee in 1992. The amount of his
additional option grants in October 1995 was determined by the Stock Option
Committee based on its subjective determination of the relative current and
future contribution of Mr. Davis to the long-term welfare of the Company.
Submitted by:
Carl J. Aschinger, Jr.*
Jeanette A. Davis*
Samuel B. Davis
Russell M. Gertmenian*
Robert S. Hamilton
Peter J. Linn
C. William McBee
---------------------
*Member of Stock Option Committee.
SUMMARY COMPENSATION TABLE
The following table summarizes compensation awarded or paid to, or earned
by, each of Liqui-Box's executive officers during each of the last three years:
<TABLE>
<CAPTION>
LONG TERM
COMPENSATION
------------
AWARDS
------------
ANNUAL COMPENSATION SECURITIES
-------------------- UNDERLYING ALL OTHER
SALARY BONUS OPTIONS/SARS COMPENSATION
NAME AND PRINCIPAL POSITION YEAR ($) ($) (#)(1) ($)
- ---------------------------- ---- ------- -------- ------------ ------------
<S> <C> <C> <C> <C> <C>
Samuel B. Davis, 1995 $70,000 $804,678 82,471 $ 9,812(2)
Chairman, Chief 1994 $70,000 $913,144 26,705 $ 4,620
Executive Officer, 1993 $70,000 $864,671 19,159 $ 14,486
Treasurer
Robert S. Hamilton, 1995 $98,077 $ 50,000 32,156 $ 0(2)
Vice-Chairman(3) 1994 $ -- $ -- -- $ --
1993 $ -- $ -- -- $ --
C. William McBee, 1995 $70,000 $134,441 30,930 $ 10,859(2)
Vice President -- 1994 $ -- $ -- -- $ --
Manufacturing(4) 1993 $ -- $ -- -- $ --
Juan Jose Perez, 1995 $41,300 $ 81,833 17,129 $ 4,278(2)
Vice President -- 1994 $ -- $ -- -- $ --
Administration(5) 1993 $ -- $ -- -- $ --
</TABLE>
- ---------------
(1) During 1995, four different option grants were made to executive officers.
See the table under "OPTIONS GRANTED IN THE LAST FISCAL YEAR."
(2) Includes employer contributions to the Liqui-Box ESOP and to the 401(k)
portion of the Liqui-Box Corporation Employees' Profit Sharing and Salary
Deferral Plan (the "Liqui-Box Profit Sharing and Salary Deferral Plan")
during 1995. Does not include amounts allocable to the named executive
officers' accounts in the deferred profit-sharing portion of the Liqui-Box
Profit Sharing and Salary Deferral Plan for 1995, which amounts will be
calculated during 1996 and disclosed as earned in 1995 in next year's proxy
statement.
7
<PAGE> 10
(3) Although Mr. Hamilton was Vice Chairman of Liqui-Box during the period from
1993 to 1995, he was not active in the day-to-day business of the Company
until 1995.
(4) Mr. McBee became an executive officer in April 1995.
(5) Mr. Perez became an executive officer in October 1995.
OPTIONS GRANTED IN THE LAST FISCAL YEAR
The following table sets forth information concerning individual grants of
options made under the 1990 Liqui-Box Corporation Stock Option Plan during the
last fiscal year to each of the named executive officers. Liqui-Box has never
granted stock appreciation rights.
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE
VALUE AT ASSUMED ANNUAL
NUMBER OF % OF TOTAL RATES OF STOCK PRICE
SECURITIES OPTIONS APPRECIATION FOR OPTION
UNDERLYING GRANTED TO TERM(1)
OPTIONS EMPLOYEES IN EXERCISE MARKET EXPIRATION -------------------------
NAME GRANTED(#) FISCAL YEAR PRICE($/SH) PRICE($/SH) DATE 0% 5%
- --------------------- ---------- ------------ ----------- ------------ ----------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Samuel B. Davis 21,647(2) 5.11% $13.625 $27.25 (2) $ 294,940 $ 992,695
10,824(3) 2.55% $27.250 $27.25 11/26/05 $ 0 $ 185,495
14,414(4) 3.40% $30.525 $27.75 10/06/05 $ (39,999) $ 211,552
35,586(5) 8.39% $27.750 $27.75 10/06/05 $ 0 $ 621,041
Robert S. Hamilton 5,505(2) 1.30% $13.625 $27.25 (2) $ 75,006 $ 94,516
1,651(3) 0.39% $27.250 $27.25 11/26/05 $ 0 $ 28,294
14,414(4) 3.40% $27.750 $27.75 10/06/05 $ 0 $ 251,551
10,586(5) 2.50% $27.750 $27.75 10/06/05 $ 0 $ 184,745
C. William McBee 3,728(2) 0.88% $13.625 $27.25 (2) $ 50,794 $ 182,048
2,202(3) 0.52% $27.250 $27.25 11/26/05 $ 0 $ 37,737
14,414(4) 3.40% $27.750 $27.75 10/06/05 $ 0 $ 251,551
10,586(5) 2.50% $27.750 $27.75 10/06/05 $ 0 $ 184,745
Juan Jose Perez 1,028(2) 0.24% $13.625 $27.25 (2) $ 14,007 $ 107,064
1,101(3) 0.26% $27.250 $27.25 11/26/05 $ 0 $ 18,868
15,000(4) 3.54% $27.750 $27.75 10/06/05 $ 0 $ 261,777
<CAPTION>
NAME 10%
- --------------------- ----------
<S> <C><C>
Samuel B. Davis $2,415,546
$ 470,081
$ 597,480
$1,573,839
Robert S. Hamilton $ 115,584
$ 71,702
$ 637,479
$ 468,180
C. William McBee $ 462,680
$ 95,632
$ 637,479
$ 468,180
Juan Jose Perez $ 474,804
$ 47,816
$ 663,395
</TABLE>
- ---------------
(1) The amounts reflected in this table represent certain assumed rates of
appreciation only. Actual realized values, if any, on option exercises will
be dependent on the actual appreciation of the common shares of Liqui-Box
over the term of the options. There can be no assurances that the Potential
Realizable Values reflected in this table will be achieved.
(2) 1995 Supplemental Retirement Discounted Options. These options are intended
to encourage executive officers to remain in the employ of Liqui-Box until
retirement and to provide them a supplemental retirement benefit. The
options become exercisable upon termination of the executive officer's
employment (other than upon termination for cause); provided, however, that
the options become fully exercisable upon an earlier change in control of
Liqui-Box. If the executive officer's employment is terminated for cause,
the options will be canceled as of the date of such termination. If the
executive officer's employment is terminated by reason of retirement or
becoming disabled, the options may be exercised at any time thereafter
during his lifetime and at any time during the six month period after his
death. If the executive officer's employment is terminated by reason of his
death, the options may be exercised at any time during the six month period
after his death. If the executive officer's employment is terminated for any
reason other than retirement, death, disability or cause, the number of
options which may be exercised is reduced by a maximum of 25%, if
termination is at age 55 or under, to a minimum of 2.5%, if termination is
at age 64 (50% to 5% during the same range of years if the executive officer
does not sign an agreement not to compete), and the options expire six
months after the executive officer's death. The Potential Realizable Values
of the options assume an expiration date of five years after each executive
officer's normal retirement date.
(3) These options were granted on November 1, 1995 as non-qualified options, and
become exercisable in 25% per year increments beginning on the first
anniversary of the grant date; provided, however, that the
8
<PAGE> 11
options become fully exercisable upon an earlier change in control of
Liqui-Box. The options are forfeited upon the executive officer's leaving
the employ of Liqui-Box, except that if the executive officer's employment
is terminated by reason of his death or becoming disabled, the options may
be exercised at any time during the six month period after his death or
termination of employment, subject to the stated term of the options. If the
executive officer enters into competition with Liqui-Box within 18 months
after the termination of his employment, the Stock Option Committee may
require him to return to Liqui-Box the economic value of any option which
was realized during the six month period prior to the date of the
termination of his employment.
(4) These options were granted on October 7, 1995 as incentive stock options,
and become exercisable in 25% per year increments beginning on the first
anniversary of the grant date; provided, however, that the options become
fully exercisable upon an earlier change in control of Liqui-Box. The
options are forfeited upon the executive officer's leaving the employ of
Liqui-Box, except that if the executive officer's employment is terminated
by reason of his death or becoming disabled, the options may be exercised at
any time during the six month period after his death or termination of
employment, subject to the stated term of the options. If the executive
officer enters into competition with Liqui-Box within 18 months after the
termination of his employment, the Stock Option Committee may require him to
return to Liqui-Box the economic value of any option which was realized
during the six month period prior to the date of the termination of his
employment.
(5) These options were granted on October 7, 1995 as non-qualified options, and
become exercisable in 25% per year increments beginning on the first
anniversary of the grant date; provided, however, that the options become
fully exercisable upon an earlier change in control of Liqui-Box. The
options are forfeited upon the executive officer's leaving the employ of
Liqui-Box, except that if the executive officer's employment is terminated
by reason of his death or becoming disabled, the options may be exercised at
any time during the six month period after his death or termination of
employment, subject to the stated term of the options. If the executive
officer enters into competition with Liqui-Box within 18 months after the
termination of his employment, the Stock Option Committee may require him to
return to Liqui-Box the economic value of any option which was realized
during the six month period prior to the date of the termination of his
employment.
9
<PAGE> 12
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION VALUES
The following table sets forth certain information with respect to options
exercised during the last fiscal year by each of the named executive officers
and information concerning unexercised options held at year end by such
executive officers:
<TABLE>
<CAPTION>
NUMBER OF SECURITIES VALUE OF UNEXERCISED
NUMBER OF UNDER- IN-THE-MONEY OPTIONS
SECURITIES LYING UNEXERCISED OPTIONS AT FISCAL
UNDERLYING AT FISCAL YEAR-END(#) YEAR-END($)(1)(2)
OPTIONS VALUE -------------------------- --------------------------
NAME EXERCISED(#) REALIZED($)(1) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ------------------ ------------ -------------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Samuel B. Davis 0 $0 11,859(3) 245,553 $32,198 $ 2,721,677
Robert S. Hamilton 0 $0 0 35,584 $ 0 $ 156,507
C. William McBee 0 $0 476 32,156 $ 0 $ 138,876
Juan Jose Perez 0 $0 0 17,129 $ 0 $ 47,188
</TABLE>
- ---------------
(1) All values as shown are pretax.
(2) Based on the fiscal year-end closing price of $29.625 per common share.
(3) On October 20, 1993, Liqui-Box granted options to Mr. Davis for the purchase
of 103,569 common shares at $14.12 per share. In 1995, Liqui-Box entered
into a new Stock Option Agreement with Mr. Davis with terms substantially
identical to the Stock Option Agreement entered into in 1993, except that
the expiration date of the options is extended from October 20, 1998 until
October 20, 2005 and become exercisable in 10% increments on each
anniversary of the grant date.
DIRECTOR COMPENSATION
Directors who are not employees of Liqui-Box receive a $2,500 per quarter
retainer.
PEER GROUP COMPARISON
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN
The following line graph compares the yearly percentage change in
Liqui-Box's cumulative total shareholder return (as measured by dividing (i) the
sum of (A) the cumulative amount of dividends for the measurement period,
assuming dividend reinvestment, and (B) the difference between Liqui-Box's
common share price at the end and the beginning of the measurement period; by
(ii) the common share price at the beginning of the measurement period) against
the cumulative return of the Wilshire 500 Index and the Dow Jones:
Containers/Packaging Industry Group Index for the five year period ended
December 31, 1995.
10
<PAGE> 13
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN
AMONG LIQUI-BOX CORPORATION, WILSHIRE 5000
AND DOW JONES CONTAINERS/PACKAGING INDEX
<TABLE>
<CAPTION>
DOW JONES
CONTAIN-
MEASUREMENT PERIOD ERS/PACKAGING
(FISCAL YEAR COVERED) LIQUI-BOX WILSHIRE 5000 INDEX
<S> <C> <C> <C>
1990 100 100 100
1991 116 131 156
1992 154 138 168
1993 208 150 158
1994 184 146 158
1995 166 195 169
</TABLE>
OVERALL -- Each performance graph index begins with a base value of $100.
This base is adjusted by annual stock market price changes and cumulative annual
dividend payments over the time frame of each index (as specified by the SEC in
its disclosure rules).
LIQUI-BOX CORPORATION -- Stock prices and dividends adjusted for stock
splits.
WILSHIRE 5000 -- The broadest of all indices, tracking value of all stock
issues for which quotes are available. Changes are measured against a base value
established in December 31, 1980. This index is market-value weighted.
DOW JONES: CONTAINERS/PACKAGING INDUSTRY GROUP -- An industry index
published by Dow Jones of geographically representative companies in the
industry. The index is adjusted to account for stock splits and dividends.
BOARD OF DIRECTOR INTERLOCKS AND INSIDER PARTICIPATION
Liqui-Box does not have a compensation committee; therefore, the Board
functions as the committee. The Board includes Samuel B. Davis, Peter J. Linn,
C. William McBee and Robert S. Hamilton, current executive officers of
Liqui-Box, each of whom participated in Board discussions concerning executive
officer compensation. John A. Maginnis, who served as a member of the Board and
as an executive officer of Liqui-Box until his resignation effective as of
August 4, 1995, also participated in Board discussions concerning executive
officer compensation. Russell M. Gertmenian, who is a partner in the law firm of
Vorys, Sater, Seymour and Pease which rendered legal services to Liqui-Box
during the 1995 fiscal year and continues to render legal services to Liqui-Box
during the 1996 fiscal year, also serves on the Board of Directors.
11
<PAGE> 14
NOTIFICATION OF APPOINTMENT OF INDEPENDENT AUDITORS
At a meeting held on April 3, 1995, the Board of Directors of Liqui-Box
dismissed the firm of Ernst & Young LLP, which had served as independent
auditors for Liqui-Box and its subsidiaries prior to and until April 3, 1995. At
a meeting held on April 7, 1995, the Executive Committee of the Company's Board
of Directors appointed the firm of Deloitte & Touche LLP to serve as independent
auditors for Liqui-Box and its subsidiaries effective April 7, 1995. The
decision to change independent auditors was recommended by the Audit Committee
of the Board of Directors of Liqui-Box and approved by the Executive Committee
of the Board of Directors.
The reports of Ernst & Young LLP on the financial statements for the fiscal
years ended December 31, 1994 and January 1, 1994 contained no adverse opinion
or disclaimer of opinion and neither of such reports was qualified or modified
as to uncertainty, audit scope or accounting principles.
There were no disagreements between Liqui-Box or its subsidiaries and Ernst
& Young LLP on any matter of accounting principles or practices, financial
statement disclosure, or auditing scope or procedure, during the fiscal years
ended December 31, 1994 and January 1, 1994 or during the period from January 1,
1995 to April 3, 1995, which disagreements, if not resolved to the satisfaction
of Ernst & Young LLP, would have required it to make reference to the subject
matter of the disagreements in connection with its report.
The Board of Directors of Liqui-Box has selected Deloitte & Touche LLP to
serve as independent auditors for Liqui-Box for the 1996 fiscal year.
Representatives of Deloitte & Touche LLP are expected to be present at the
Annual Meeting, will be given the opportunity to make a statement if they desire
to do so and will be available to respond to appropriate questions.
ANNUAL REPORT
The 1995 Annual Report, which includes financial statements and information
concerning Liqui-Box's operations during the 1995 fiscal year, accompanies this
Proxy Statement.
LIQUI-BOX WILL PROVIDE, WITHOUT CHARGE, TO ANY PERSON SOLICITED (UPON
WRITTEN REQUEST OF SUCH PERSON), A COPY OF LIQUI-BOX'S ANNUAL REPORT ON FORM
10-K FOR THE 1995 FISCAL YEAR, INCLUDING THE FINANCIAL STATEMENTS AND THE
FINANCIAL STATEMENT SCHEDULES THERETO, REQUIRED TO BE FILED WITH THE SEC. SUCH
REQUEST SHOULD BE ADDRESSED TO SAMUEL B. DAVIS, CHAIRMAN, LIQUI-BOX CORPORATION,
P.O. BOX 494, WORTHINGTON, OHIO 43085-0494.
OTHER MATTERS
The management and the Board of Directors of Liqui-Box do not know of any
other matters which may come before the Annual Meeting. However, if any other
matters properly come before the Annual Meeting, it is the intention of the
persons named in the accompanying form of proxy to vote the common shares
represented by the proxy in their discretion as the Board of Directors may
recommend. The enclosed proxy is being solicited by the Board of Directors of
Liqui-Box which will bear the cost of solicitation of proxies. In addition to
the use of the mails, proxies may be solicited by officers, directors and
regular employees of Liqui-Box, personally, by telephone or by telegraph.
SHAREHOLDER PROPOSALS
Any proposals by Liqui-Box shareholders intended to be presented at the
1997 Annual Meeting of Shareholders must be received by Liqui-Box prior to
November 18, 1996, in order to be considered for inclusion in Liqui-Box's 1997
Proxy Statement.
By Order of the Board of Directors
Peter J. Linn
Secretary
12
<PAGE> 15
LIQUI-BOX CORPORATION
SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
FOR ANNUAL MEETING OF SHAREHOLDERS TO BE HELD ON APRIL 24, 1996
The undersigned hereby constitutes and appoints Jeanette A. Davis, Samuel B.
Davis and Peter J. Linn and each of them, with full power of substitution and
revocation, as proxy or proxies to appear and vote the common shares of
Liqui-Box Corporation ("Liqui-Box") which the undersigned would be entitled to
vote if personally present at the Annual Meeting of Shareholders on April 24,
1996, and any adjournment thereof, for the following purposes:
1. Election of three (3) directors for terms expiring in 1998.
<TABLE>
<S> <C>
/ / FOR all nominees listed below / / WITHHOLD AUTHORITY
(except as marked to contrary below)* to vote for all nominees listed below
</TABLE>
Samuel B. Davis Robert S. Hamilton Russell M. Gertmenian
* (INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE,
WRITE THAT NOMINEE'S NAME ON THE LINE PROVIDED BELOW:)
- --------------------------------------------------------------------------------
2. In their discretion, the proxies are authorized to vote upon such other
business as may properly come before the meeting.
(Over)
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED AS SPECIFIED BY THE
SHAREHOLDERS. IF NO SPECIFICATION IS MADE, THIS PROXY WILL BE VOTED FOR PROPOSAL
1. IF ANY OTHER MATTERS ARE BROUGHT BEFORE THE MEETING OR IF A NOMINEE FOR
ELECTION AS A DIRECTOR NAMED IN THE PROXY STATEMENT IS UNABLE TO SERVE OR FOR
GOOD CAUSE WILL NOT SERVE, THE PROXY WILL BE VOTED IN THE DISCRETION OF THE
PROXIES ON SUCH MATTERS OR FOR SUCH SUBSTITUTE NOMINEE(S) AS THE DIRECTORS MAY
RECOMMEND.
The undersigned hereby acknowledges receipt of the Notice of Annual Meeting and
Proxy Statement and hereby expressly revokes any and all proxies heretofore
given or executed by the undersigned with respect to the common shares
represented by this proxy.
Date.........................
.............................
.............................
(Please sign here exactly as
name appears herein. If
common shares are registered
in two names, both should
sign.) When signing as
attorney, executor,
administrator, trustee,
guardian or corporate
official, please give your
full title.
