Please Note the Accompanying
Proxy Statement and Proxy Card
It is important to you and to the Corporation that your shares be represented
at the meeting regardless of the number you may hold. If you are unable to be
present in person, we ask that you sign, date and return the enclosed Proxy
in favor of the Proxy Committee designated by the Board of Directors.
Notice of Annual Meeting
To Stockholders of Corning Incorporated:
Notice is hereby given that the Annual Meeting of the holders of Common Stock
and Series B 8% Convertible Preferred Stock of Corning Incorporated will be
held in the office of the Corporation [in the Corning Glass Center] in the
City of Corning, State of New York, on Thursday, April 27, 1995 at 11:00
o'clock A.M. The principal business of the meeting will be:
[a] To elect five Directors for three-year terms; and
[b] To transact such other business as may properly come before the meeting.
A. John Peck, Jr.
Secretary
Corning Incorporated
One Riverfront Plaza
Corning, New York 14831
March 8, 1995
<PAGE>
(BLANK PAGE)
<PAGE>
Proxy Statement
Relating to the Annual Meeting of Stockholders, April 27, 1995. The enclosed
Proxy is solicited by the Board of Directors of Corning Incorporated
[hereinafter referred to as the "Corporation" or "Corning"], Corning, New
York 14831. The Corporation anticipates that this Proxy Statement and the
enclosed Proxy will be mailed to holders of the Corporation's Common Stock
and Series B 8% Convertible Preferred Stock [hereinafter referred to as the
"Preferred Stock"] commencing on or about March 16, 1995. The Proxy may be
revoked by written notice to the Corporation prior to the meeting or by
written notice to the Secretary at the meeting at any time prior to being
voted. Each valid and timely Proxy not revoked will be voted at the meeting
in accordance with the instructions thereon.
Holders of Common and Preferred Stock on the books of the Corporation at the
close of business on March 8, 1995 are entitled to notice of and to vote at
the meeting. On February 1, 1995, the Corporation had outstanding 228,348,662
shares of Common Stock, each entitled to one vote, and 254,094 shares of
Preferred Stock, each entitled to four votes.
Action to be Taken Under the Proxy
The persons acting under the Proxy will vote the shares represented thereby
for the election of Roger G. Ackerman, David A. Duke, John H. Foster,
Catherine A. Rein and William D. Smithburg as directors. The Board of
Directors does not know of any other business to be brought before the
meeting, but it is intended that, as to any such other business, a vote may
be cast pursuant to the Proxy in accordance with the judgment of the person
or persons acting thereunder. Should any above-named nominee for the office
of director become unable to accept nomination or election, which is not
anticipated, it is intended that the persons acting under the Proxy will vote
for the election of such other person as the Board of Directors may
recommend.
Voting Procedures
New York's Business Corporation Law provides that, a quorum being present,
nominees for the office of director are to be elected by a plurality of votes
cast at the meeting. Only shares affirmatively voted in favor of a nominee
will be counted toward the achievement of a plurality. Votes withheld
[including broker non- votes] are counted as present for the purpose of
determining a quorum but are not counted in determining the existence of a
plurality.
Nominees for Election as Directors
The Corporation's Board of Directors is divided into three classes. Each of
the above-named nominees for the office of director is a member of the
present Board of Directors and, except for John H. Foster, was elected by the
Corporation's security holders. The terms of Roger G. Ackerman, David A.
Duke, John H. Foster, Catherine A. Rein and William D. Smithburg expire this
year. Messrs. Conable and Stone are not standing for re-election in
accordance with the Corporation's retirement policy. Mr. E. Martin Gibson
retired as an employee and resigned as a director in December 1994. No
nominee is now the beneficial owner of any of the securities [other than
directors' qualifying shares] of any of the Corporation's subsidiaries.
Certain information with respect to nominees for election as directors and
directors whose term of office will continue after the Annual Meeting is set
forth below.
1
<PAGE>
Nominees for Election - Terms Expiring 1998
[Photo of Roger G. Ackerman]
Roger G. Ackerman*
President, Corning Incorporated
Mr. Ackerman, a graduate of Rutgers University and the PMD program at
Harvard, has served Corning since 1962 in a variety of engineering, sales and
management positions. In 1972 he was elected the president of a Corning
subsidiary, Corhart Refractories Co., in 1975 the general manager and vice
president of the Ceramic Products Division and in 1980 a senior vice
president. In 1981 Mr. Ackerman became the director of the Manufacturing and
Engineering Division, in 1983 the president of MetPath Inc. and in 1985 group
president and a director. In 1990, he was elected the president and chief
operating officer of Corning. Mr. Ackerman, 56, is a director of The Pittston
Company, The Massachusetts Mutual Life Insurance Company and Dow Corning
Corporation, a trustee of the Corning Incorporated Foundation and the Corning
Museum of Glass and a member of the executive committee of the National
Association of Manufacturers.
[Photo of David A. Duke]
David A. Duke*
Vice Chairman, Corning Incorporated
Dr. Duke, a graduate of, and with advanced degrees from, the University of
Utah, has served Corning in a succession of research and management positions
since 1962. He was elected a vice president - Telecommunications Products in
1980, elected a senior vice president in 1984 and named director of Research
and Development in 1985. He became responsible for Research, Development and
Engineering in March 1987 and was elected vice chairman of technology and a
director in 1988. Dr. Duke, 59, is a director of Corning International
Corporation, Dow Corning Corporation, Siecor Corporation and Armco, Inc. and
a member of a number of scientific organizations.
[Photo of John H. Foster]
John H. Foster
Chairman and Chief Executive Officer
NovaCare, Inc.
Mr. Foster, founder, chairman of the board and chief executive officer of
NovaCare, Inc., a national provider of comprehensive rehabilitation services,
is also founder, chairman of the board and chief executive officer of Apogee,
Inc., a national provider of mental health services, and of Foster Management
Company, an investment advisory firm. Mr. Foster, 52, a graduate of Williams
College and the Amos Tuck School of Business Administration at Dartmouth
College, is a trustee of the Hospital for Special Surgery, the Children's
Hospital of Philadelphia, the Mystic Seaport Museum and the Philadelphia
Maritime Museum and a member of the Dean's Council of the Harvard School of
Public Health and the Amos Tuck School Board of Overseers. He was elected a
director of the Corporation in October, 1994.
2
<PAGE>
[Photo of Catherine A. Rein]
Catherine A. Rein++
Executive Vice President
Metropolitan Life Insurance Company
Ms. Rein, a graduate of Pennsylvania State University and New York
University, joined Metropolitan Life Insurance Company in 1985 as a vice
president in the human resources department. In 1988 she was named senior
vice president and in 1989 was named executive vice president in charge of
the corporate and professional services departments. Prior to 1985 she was
vice president and general counsel for The Continental Group, Inc. Ms. Rein,
51, elected a director of the Corporation in 1990, is a director of the Bank
of New York, Inroads/NYC, Inc. and General Public Utilities and a trustee of
the Urban League and the New York University Law Center Foundation.
[Photo of William D. Smithburg]
William D. Smithburg++
Chairman and Chief Executive Officer
The Quaker Oats Company
A graduate of DePaul University with an MBA from Northwestern University, Mr.
Smithburg joined Quaker Oats in 1966. He was elected a vice president in
1971, executive vice president - U.S. grocery products in 1976, president in
1979, chairman and chief executive officer in 1983 and served as president
from November 1990 to January 1993. Mr. Smithburg, who is 56, was elected a
director of the Corporation in 1987 and is a director of Abbott Laboratories,
Northern Trust Corporation, Prime Capital Corp. and the Grocery Manufacturers
Association.
Directors Continuing in Office
[Photo of Robert Barker]
Robert Barker++
Senior Fellow, Center for the Environment, Cornell University
Dr. Barker, a graduate of the University of British Columbia and the
University of California at Berkeley, has served on the faculties of the
University of Iowa and Michigan State University and has been associated with
Cornell University since 1979 as Professor of Biochemistry, Director of the
Division of Biological Sciences, as Vice President for Research and Advanced
Studies, as Provost, as Senior Provost and as Director and presently as
Senior Fellow of the Center for the Environment. He has served as a
consultant to the National Institutes of Health, the National Academy of
Sciences, the Oak Ridge and Los Alamos National Laboratories and the National
Board of Medical Examiners. Dr. Barker is 66 and was elected a director of
the Corporation in 1986. His term expires at the 1997 Annual Meeting.
3
<PAGE>
[Photo of Mary L. Bundy]
Mary L. Bundy++
Mrs. Bundy, a graduate of Radcliffe College and the Hunter College School of
Social Work, is a clinical social worker in private practice. She was a case
worker with the Jewish Board of Family and Children's Services, Inc. in New
York City from 1980 to 1984. A former trustee and vice chairman of the Board
of Trustees of Radcliffe College, she was acting vice president of the
College in 1978. Mrs. Bundy, 69, was elected to the board of the Corporation
in 1973. She is chairwoman of the Edward W. Hazen Foundation, a director of
the Foundation for Child Development, a former trustee of the Metropolitan
Museum of Art and a former overseer of Harvard University. Her term expires
at the 1997 Annual Meeting.
[Photo of Van C. Campbell]
Van C. Campbell*
Vice Chairman, Corning Incorporated
A graduate of Cornell University with an MBA from Harvard, Mr. Campbell
joined Corning in 1964. Elected an assistant treasurer in 1971, treasurer in
1972, a vice president in 1973, financial vice president in 1975 and senior
vice president for finance in 1980, he became general manager of the Consumer
Products Division in October 1981. He was elected vice chairman responsible
for finance and administration and a director in 1983. Mr. Campbell, who is
56, is a director of Corning International Corporation, Corning Life Sciences
Inc., Dow Corning Corporation, Armstrong World Industries, Inc. and General
Signal Corporation. His term expires at the 1997 Annual Meeting.
[Photo of Gordon Gund]
Gordon Gund++
President and Chief Executive Officer Gund Investment Corporation
Mr. Gund, president and chief executive officer of Gund Investment
Corporation, which manages diversified investment activities, is principal
owner of the Cleveland Cavaliers National Basketball Association team, a
member of the Board of Governors of the National Basketball Association,
co-owner of the San Jose Sharks National Hockey League team and a member of
the Board of Governors of the National Hockey League. He is chairman and
chief executive officer of Gund Business Enterprises, which owns Nationwide
Advertising Services, Inc. and CAVS/Gund Arena Company. He is also a general
partner of GUS Enterprises. He is a director of the Kellogg Company and
Kepner-Tregoe, Inc., president and a trustee of the Gund Collection of
Western Art and co-founder and chairman of the Foundation Fighting Blindness.
Mr. Gund, 55, elected a director of the Corporation in 1990, is a graduate of
Harvard University. His term expires at the 1996 Annual Meeting.
4
<PAGE>
[Photo of John M. Hennessy]
John M. Hennessy++
Chairman of the Executive Board and Chief Executive Officer
CS First Boston
Mr. Hennessy, a graduate of Harvard College, was a National Science
Foundation Fellow at the Sloan School, Massachusetts Institute of Technology,
in economics and finance and served as Deputy Assistant Secretary of Treasury
Affairs for Development Finance from 1970 to 1972 and as Assistant Secretary
for International Affairs, Department of Treasury, from 1972 to 1974. He
became managing director of First Boston Corporation, a subsidiary of CS
First Boston, Inc., in 1974, was named vice chairman of First Boston
Corporation in 1982 and vice chairman of CS First Boston, Inc. in 1989,
President and Group Chief Executive Officer in October 1989 and in 1993 was
elected to his present position. Mr. Hennessy, 58, was elected a director of
the Corporation in 1989 and is a director of Vitro, S.A. and M.I.T.
Corporation and a member of numerous civic committees. His term expires at
the 1996 Annual Meeting.
[Photo of James R. Houghton]
James R. Houghton*
Chairman of the Board and Chief Executive Officer
Corning Incorporated
A graduate of Harvard College and Harvard Business School, Mr. Houghton
joined Corning in 1962. He became a vice president of Corning and general
manager of the Consumer Products Division in 1968, a director in 1969, vice
chairman in 1971, chairman of the executive committee and chief strategic
officer in 1980 and chairman and chief executive officer in April 1983. Mr.
Houghton, 58, is a director of Dow Corning Corporation, Metropolitan Life
Insurance Company, J. P. Morgan & Co. Incorporated and Exxon Corporation. His
term expires at the 1997 Annual Meeting.
[Photo of Vernon E. Jordan, Jr.]
Vernon E. Jordan, Jr.++
Senior Partner
Akin, Gump, Strauss, Hauer & Feld, LLP, Washington, D.C.
A graduate of DePauw University and Howard University Law School, Mr. Jordan
is a senior partner in the law firm of Akin, Gump, Strauss, Hauer & Feld,
LLP. Mr. Jordan's directorships include American Express Company, Dow Jones &
Company, Inc., J. C. Penney Company, Inc., Sara Lee Corporation, Ryder
System, Inc., The Ford Foundation, Xerox Corporation, Revlon Group, Inc.,
Union Carbide Corporation, Bankers Trust Company and its parent, Bankers
Trust New York Corporation. He is 59 and was elected a director of the
Corporation in 1983. His term expires at the 1996 Annual Meeting.
5
<PAGE>
[Photo of James W. Kinnear]
James W. Kinnear++
Retired President and Chief Executive Officer, Texaco Inc.
A 1950 graduate of the United States Naval Academy, Mr. Kinnear joined Texaco
in 1954. In 1977 he was elected a director, and from 1987 until April, 1993
was President and Chief Executive Officer of Texaco Inc. Mr. Kinnear, 66, was
elected a director of the Corporation in 1978 and is a director of ASARCO
Incorporated and Paine Webber Group Inc., an advisory director of Unilever
N.V. and Unilever PLC and an alternate director of MIMS Holdings Ltd. He is
Chairman of the Metropolitan Opera Association, a member of the Board of
Overseers and Managers of Memorial Sloan- Kettering Cancer Center, a member
of the Board of Managers of The New York Botanical Garden and a trustee of
the American Enterprise Institute. His term expires at the 1997 Annual
Meeting.
[Photo of James J. O'Connor]
James J. O'Connor++
Chairman of the Board and Chief Executive Officer
Unicom Corporation
A graduate of Holy Cross College, Harvard Business School and Georgetown Law
School and a veteran of the U.S. Air Force, Mr. O'Connor joined Commonwealth
Edison Company (the principal subsidiary of Unicom Corporation) in 1963. He
became a vice president of Commonwealth Edison in 1970, executive vice
president in 1973, president in 1977, a director in 1978 and chairman and
chief executive officer in 1980. In 1994 he was also named chairman and chief
executive officer of Unicom Corporation, which then became the parent company
of Commonwealth Edison. Mr. O'Connor, 57, is a director of Tribune Company,
First Chicago Corporation, The First National Bank of Chicago, Scotsman
Industries, Inc. and United Air Lines. He was elected a director of the
Corporation in 1984. His term expires at the 1997 Annual Meeting.
[Photo of Henry Rosovsky]
Henry Rosovsky++
Geyser University Professor, Harvard University
Dr. Rosovsky, the Lewis P. and Linda L. Geyser University Professor, has been
associated with the Harvard University economics department since 1965. From
1973 to 1984 he served as dean of the faculty of arts and sciences. In 1971
he served as consultant to the President's Commission on International Trade
and Foreign Investment, and in 1977 and 1978 as a consultant to the Asian
Development Bank. Dr. Rosovsky, a graduate of the College of William and Mary
with advanced degrees from Harvard, is a director of Paine Webber Group, Inc.
and The Japan Fund, Inc. He is 67 and was elected a director of the
Corporation in 1980. His term expires at the 1996 Annual Meeting.
* Member of the Executive Committee
++ Alternate member of the Executive Committee
6
<PAGE>
Security Ownership of
Certain Beneficial Owners
Unless otherwise indicated, each of the persons named in paragraph [a] and in
paragraph [b] below has sole voting and investment power with respect to the
shares listed.
[a] The only person who, to the knowledge of the management, owned
beneficially on December 31, 1994 more than 5% of the outstanding shares of
Common and Preferred Stock of the Corporation is set forth below:
<TABLE>
<CAPTION>
Shares Owned
Name and Address and Nature of Percent
of Beneficial Owner Beneficial Ownership of Class
<S> <C> <C>
Corning Incorporated 11,693,756 Common 5.13 %
Investment Plans
c/o United States Trust
Company of New York
770 Broadway
New York, NY 10003
</TABLE>
[1] Includes 10,677,128 shares of Common Stock and the equivalent thereof in
254,157 shares of Preferred Stock [being 100% of the Class] held by United
States Trust Company of New York as the trustee of the Corporation's
Investment Plans. Each share of Common Stock is entitled to one vote and each
share of Preferred Stock is entitled to four votes. See also footnote [4] of
paragraph [b] below.
[b] Set forth below is the number of shares of Common Stock and Common Stock
equivalents, assuming the conversion of outstanding shares of Preferred Stock
into shares of Common Stock, of the Corporation beneficially owned on
December 31, 1994 by the directors and nominees for directors; by the chief
executive officer, the other four most highly compensated executive officers
and one executive officer who retired during 1994 [collectively, the "named
executive officers"] and by all directors and executive officers of the
Corporation as a group:
<TABLE>
<CAPTION>
Shares Owned
and Nature of Percent
Beneficial of
Name Ownership Class
<S> <C> <C>
Directors
Robert Barker 7,145 --
Mary L. Bundy 7,600 --
Barber B.Conable, Jr. 8,000 --
John H. Foster 4,400 --
Gordon Gund 110,423 --
John M. Hennessy 6,876 --
Vernon E. Jordan, Jr. 8,382 --
James W. Kinnear 8,800 --
James J. O'Connor 8,846 --
Catherine A.Rein 6,800 --
Henry Rosovsky 6,720 --
William D. Smithburg 6,000 --
Robert G. Stone, Jr. 12,000 --
Named Executive Officers
[*also serve as directors]
Roger G. Ackerman* 360,662 --
Van C. Campbell* 379,588 --
David A. Duke* 243,318 --
E. Martin Gibson 211,988 --
James R. Houghton* 2,130,533 --
Randy H. Thurman 109,889 --
All Directors and
Executive Officers
as a Group 5,955,356 2.61%
</TABLE>
[1] Includes shares of Common Stock purchased pursuant to the terms of the
Corporation's Equity Purchase Plan and which may be resold only to the
Corporation. Messrs. Gibson, Houghton and all directors and executive
officers as a group own 5,200, 1,600 and 131,868 such shares, respectively.
7
<PAGE>
[2] Includes shares of Common Stock, subject to forfeiture and restrictions
on transfer, granted pursuant to the Corporation's Incentive Stock Plans as
well as options to purchase shares of Common Stock exercisable within 60 days
under the Corporation's Stock Option Plans. Messrs. Ackerman, Campbell, Duke,
Gibson, Houghton and Thurman have the right to purchase 147,500, 154,424,
109,000, 34,997, 286,000 and 10,000 shares, respectively, pursuant to such
options. All directors and executive officers as a group hold options to
purchase 1,575,056 such shares.
[3] Includes shares of Common Stock, subject to forfeiture and restrictions
on transfer, issued pursuant to the Corporation's Restricted Stock Plans for
Non- Employee Directors.
[4] Includes all shares of capital stock, Common Stock and the equivalent
thereof in Preferred Stock on the basis of four shares of Common Stock for
each share of Preferred Stock, held by United States Trust Company of New
York as the trustee of the Corporation's Investment Plans for the benefit of
the members of the group, who may instruct the trustee as to the voting of
such shares. If no instructions are received, the trustee votes the shares in
the same proportion as it votes all of the shares for which instructions were
received. Shares of Preferred Stock may be held only by the trustee. The
power to dispose of shares of Common and Preferred Stock is also restricted
by the provisions of the Plans. The trustee holds for the benefit of Messrs.
Ackerman, Campbell, Duke, Gibson, Houghton, Thurman and all directors and
executive officers as a group the equivalent of 20,820, 31,695, 8,835,
17,461, 43,988, 189, and 223,026 shares of Common Stock, respectively, and
for the benefit of all employees who participate in the Plans the equivalent
of 11,693,756 shares of Common Stock, each entitled to one vote, being
10,677,128 shares of Common Stock and 254,157 shares [being 100% of the
Class] of Preferred Stock, each entitled to four votes.
[5] In addition, Messrs. Barker, Gund, Hennessy, Kinnear, O'Connor, Rosovsky
and Smithburg have credited to their accounts the equivalent of 18,405,
3,707, 5,475, 12,141, 2,563, 6,925 and 9,670 shares, respectively, of Common
Stock in valuation entry form under the Corporation's Deferred Compensation
Plan for Directors. Deferred fees will be paid solely in cash at or following
termination of service as a director.
[6] The holder shares voting and investment power with respect to 5,000 of
such shares.
[7] Includes 719,442 shares held in trusts for the benefit of Mr. Houghton as
income beneficiary. Does not include 1,198 shares owned by Mr. Houghton's
wife, as to which Mr. Houghton disclaims beneficial ownership. Also does not
include 141,738 shares held in trust by Market Street Trust Company as a
co-trustee for the benefit of Mr. Houghton's children as to which Mr.
Houghton disclaims beneficial ownership. Also does not include 10,847,340
shares, other than the shares referred to above in this footnote, held in
trusts by Market Street Trust Company, as to which Mr. Houghton disclaims
beneficial ownership. Market Street Trust Company is a limited purpose trust
company controlled by the Houghton family, the directors of which include
James R. Houghton and other Houghton family members.
[8] Does not include 23,240 shares owned by the spouses and minor children of
certain executive officers and directors as to which such officers and
directors disclaim beneficial ownership.
[9] Unless otherwise indicated, does not exceed 1% of the Class of Common
Stock.
Report of the Compensation Committee of the
Board of Directors on Executive Compensation
Executive compensation at Corning is administered by the Compensation
Committee of the Board of Directors, composed entirely of non-employee
directors. The following is the Committee's report.
"The Compensation Committee reviews and recommends executive compensation
levels, cash and equity incentives for executive officers and reports such
recommendations to the Board for its consideration and action.
8
<PAGE>
The strategies guiding the Committee's recommendations regarding the
Corporation's compensation program, the impact of performance within that
program and a description of actions affecting 1994 compensation for Mr.
Houghton, Chairman of the Board of Directors and Chief Executive Officer of
the Corporation, are discussed below.
Compensation Strategy
The Committee is responsible for ensuring that executive compensation is
based on objective measures of performance at the individual, corporate and
applicable business unit level. The Committee believes that compensation
should be driven by the long-term interests of the stockholders and should be
directly linked to corporate performance. The Committee's basic strategic
compensation principles are as follows:
* Executive compensation will reward performance and contribution to
stockholder value and be competitive with positions of similar responsibility
at other companies of comparable markets, size and performance.
* As employees assume greater responsibilities, an increasing share of their
total compensation package will be derived from variable incentive
compensation (both of a long- and short-term nature) generated by achievement
of performance objectives designed to produce long-term growth in stockholder
value.
* Performance-based equity incentives and stock option grants are effective
ways to align the long-term interests of employees with those of
stockholders.
* The benefits package for executives will be substantially identical to that
offered all salaried employees and will be designed to encourage long-term
commitment to the Corporation.
The executive compensation program is composed of four elements: base salary;
annual incentives; long- term equity based incentives; and stock options. The
Committee tests annually each element of the compensation program against
market surveys and information provided by three independent compensation
consultants. Such surveys currently include in the aggregate in excess of 200
companies engaged in a variety of manufacturing and service industries, all
of which are "Fortune 500" companies and each of which is included in the S&P
500 Index and some of which are included in the S&P 500 Miscellaneous
Industrial Companies Index. It is Corning's compensation strategy to target
each element of compensation at approximately the median of the compensation
levels of such companies.
Compensation Program
Annual compensation of the named executives as shown in the "Salary" and
"Bonus" columns of the Summary Compensation Table, and recommendations by the
Committee to adjust salary levels and bonus targets, are based on an
individual's responsibilities and performance against established return on
equity and earnings per share goals, overall corporate performance and
external comparative compensation information.
Annual variable incentives are paid through the Variable Compensation Plan
under which minimum, target and maximum awards are set by the Committee based
on position level. Awards are earned based on achievement of annual
predetermined return on equity and net earnings goals set by the Committee.
In 1994 performance against such goals exceeded target.
Under the 1994 Employee Equity Participation Program, the Corporation
developed a series of performance-based goals [herein referred to as the
"Corporate Performance Plan"]. The Corporate Performance Plan provides the
mechanism to reward improvement in return on equity and earnings growth as
measured by net income and earnings per share. Each year, the Committee sets
minimum, target and maximum goals and awards shares [at target levels] of
Common Stock which are subject to forfeiture in whole or in part if goals are
not met. Shares earned under the Plan may range from 0% to 150% of target
award, depending on actual performance results.
9
<PAGE>
Shares earned remain subject to forfeiture and restrictions on transfer for
two years following the end of the performance period. Performance for 1994
exceeded target. Based on 1994 performance, 141% of the shares granted in
December 1993 were earned under the Plan by the named executive officers [as
indicated in the Corporate Performance Plan Activity Table].
Stock options were granted to named executive officers in December 1993, in a
defined ratio to the "performance-based" shares described above. Options to
purchase two shares of Common Stock were granted for every one performance
share issued. In order to foster commitment to long-term stockholder value,
participants in the Plan must hold [through the performance and restriction
period] one share of unencumbered Common Stock for every six shares subject
to options granted. If unencumbered shares are not held, the options and the
"performance-based" shares are forfeited.
In determining the number of stock options and shares to be made available to
executives under the Corporate Performance Plan, the Committee evaluated
comparative external market data described above with respect to the stock
options granted and performance-based shares awarded by the external
companies included in such data, the number of shares of Common Stock already
subject to restriction and option and the number of additional shares to be
awarded necessary to align directly management and stockholder interests.
The pension and welfare benefits provided to executives are substantially
equal to those provided to all salaried employees. Employees whose
pensionable earnings exceed federal limits participate in a non- qualified
supplemental retirement plan.
In 1994, the Corporation, at the direction of the Committee, requested and
obtained stockholder approval of the performance criteria used under the 1988
Variable Compensation Plan and the Corporate Performance Plan for purposes of
qualifying the incentives and awards under such plans as performance- based
for purposes of Section 162[m] of the Internal Revenue Code of 1986, as
amended.
CEO Compensation Actions - 1994
Base Salary: In December 1993, the Committee concluded that Mr. Houghton's
base salary would be kept constant for 1994 at $700,000 per annum and that
greater emphasis should be placed upon the annual bonus incentive programs,
thereby causing a greater portion of Mr. Houghton's total cash compensation
to be at risk and dependent on the performance of the Corporation. As a
result of this decision, Mr. Houghton received no salary increase during
1994. This action positioned Mr. Houghton's salary below the 50th percentile
of the market for similarly-sized companies. In turn, Mr. Houghton's
incentive target for 1994 was increased by 5% to 80% of base salary.
Annual Incentives: Mr. Houghton's bonus for 1994 is composed of two parts:
First, Mr. Houghton received 109.6% of his year-end 1994 base salary under
the Variable Compensation Plan. This award is based on the Corporation
achieving 112.6% of the profitability goal set by the Committee on February
2, 1994. Second, Mr. Houghton received 7.72% [1994 minimum = 0%; maximum =
10%] of his year-end base salary under the Corporation's Goal Sharing Plan,
which is the average percentage of amounts awarded to approximately 15,000
Corning employees participating in 1994 in the Goal Sharing Plan.
Long-Term Incentives: Under the Corporate Performance Plan, Mr. Houghton
earned for 1994 performance 25,165 [or 144%] of the shares granted to him in
December 1993 in connection with the 1994 return on equity targets. The
return on equity achieved, adjusted for one-time events, was 108.9% of target
which resulted in a final award for return on equity of 137.5% for half of
the shares originally granted. The earnings per share achieved, adjusted for
one-time events, was 113.3% of target which resulted in a final award for
earnings per share of 150% for half of the shares originally granted. As the
two goals have equal weighing for determining the shares to be earned, 143.8%
of the shares were earned.
Mr. Houghton earned 10,272 shares [or 64.2% of the Common Stock shares
granted to him in December 1991] under the Corporate Performance Plan for the
10
<PAGE>
1992-1994 long-term performance period. Minimum, target and maximum earnings
per share criteria were 8%, 12% and 16% annual compounded rate increases in
earnings per share for the three-year period over year-end 1991 earnings per
share results. The earnings per share achieved, adjusted for one-time events,
was 91.9% of target which resulted in a final award for earnings per share of
61% for half of the shares originally granted. The return on equity average
for 1992- 1994, adjusted for one-time events, was 90.9% of target which
resulted in a final award for return on equity of 67.4% for half of the
shares originally granted. As the two criteria, earnings per share and return
on equity, have equal weight, 64.2% of the shares granted for the third year
of the 1992-1994 Corporate Performance Plan were earned. The value of the
10,272 shares earned [$312,654] is shown in the column in the Summary
Compensation Table entitled "Long-Term Incentive Plan Payouts".
In December 1994, Mr. Houghton was granted [i] 17,500 shares of Common Stock
under the Corporate Performance Plan for 1995 performance, which shares are
subject to forfeiture if the Corporation fails to achieve the 1995 earnings
per share and return on equity objectives and [ii] stock options covering
35,000 shares at fair market value on the date of grant. The options become
exercisable in February 1998 and expire in November 2004. The retention of
the "performance-based" shares and the stock options granted are subject to
the additional requirement to hold unencumbered shares in accordance with the
terms of the Corporate Performance Plan described above. The 17,500 shares
are shown in the Corporate Performance Plan Activity Table for 1995.
Conclusion
The Committee believes that the quality of executive leadership significantly
affects the long-term performance of the Corporation and that it is in the
best interest of the stockholders to compensate fairly executive leadership
for achievement in meeting or exceeding the high standards set by the
Committee, so long as there is corresponding risk when performance falls
short of such standards. A primary goal of the Committee is to relate
compensation to corporate performance. The Committee believes that Corning's
current executive compensation program meets such standards and has
contributed, and will continue to contribute, to the Corporation's success.
The Compensation Committee:
James W. Kinnear, Chairman
Vernon E. Jordan, Jr.
James J. O'Connor
Robert G. Stone, Jr."
11
<PAGE>
Performance Graph
Set forth below is a graph illustrating the Corporation's cumulative total
stockholder return over the last five years compared to two performance
indicators of the stock market, the S&P 500 and the S&P Miscellaneous
Industrial Companies in which the Corporation is included. The latter
includes the capital weighted performance results of those companies in the
miscellaneous industrial companies classification that are also included in
the S&P 500.
Comparison of Five-Year Cumulative Total Return
Among Corning Incorporated, S&P 500 and S&P Miscellaneous Industrial Companies
(Fiscal Years Ending December 31)
<TABLE>
<CAPTION>
1989 1990 1991 1992 1993 1994
<S> <C> <C> <C> <C> <C> <C>
Corning Incorporated 100.0 106.3 185.3 184.0 140.7 153.7
S&P 500 100.0 96.9 126.4 136.0 149.8 151.7
S&P Miscellaneous 100.0 97.7 123.3 137.9 158.7 163.9
</TABLE>
12
<PAGE>
Executive Compensation
The following tables and charts set forth information with respect to
benefits made available, and compensation paid or accrued, by the Corporation
and its subsidiaries during the year ended December 31, 1994 for services by
each of the chief executive officer, the four most highly compensated
executive officers [other than the chief executive officer] and one executive
officer of the Corporation who retired during 1994, whose total salary and
bonus exceeded $100,000. The Corporation regards total annual pay as the
combination of the cash amounts set forth under the salary and bonus columns.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
Long-Term Compensation
Annual Compensation Awards Payouts
Other All
Annual Restricted Securities Incentive Other
Name and Compen- Stock Underlying Plan Compen-
Principal Position Year Salary Bonus sation Awards Options Payouts sation
<S> <C> <C> <C> <C> <C> <C> <C> <C>
James R. Houghton, 1994 $700,000 $821,240 $34,020 $ 765,960 35,000 $312,654 $ 72,965
Chairman of 1993 672,500 481,618 34,605 348,845 35,000 132,900 53,953
the Board 1992 645,000 563,692 37,161 213,514 32,000 0 94,953
Roger G. Ackerman, 1994 525,000 621,720 29,651 547,114 28,000 244,261 54,271
President 1993 482,500 353,888 34,969 196,413 25,000 103,828 41,802
1992 465,000 421,150 29,700 166,817 25,000 0 69,783
Van C. Campbell, 1994 450,000 435,465 18,441 437,691 25,000 195,409 44,107
Vice Chairman 1993 400,000 264,285 25,744 160,794 20,000 83,063 33,035
1992 375,000 316,237 18,316 663,696 20,000 0 38,516
David A. Duke, 1994 400,000 387,080 17,102 437,691 25,000 195,409 38,036
Vice Chairman 1993 382,500 215,960 22,689 160,794 20,000 83,063 32,483
1992 365,000 307,804 21,649 133,446 20,000 0 49,524
E. Martin Gibson, 1994 480,000 557,376 35,425 547,114 0 0 50,518
Former Chairman 1993 462,500 338,112 17,500 0 25,000 0 40,050
of Corning Life 1992 445,000 403,036 12,000 0 30,000 0 59,879
Sciences Inc.
Randy H. Thurman, 1994 443,750 449,600 45,042 1,277,982 25,000 0 110,094
Chairman of Corning
Life Sciences Inc.
</TABLE>
[1] Includes dividends on shares of restricted stock granted but not earned
within one year from date of grant and tax gross-up payments.
[2] At year end 1994, Messrs. Houghton, Ackerman, Campbell, Duke, Gibson and
Thurman held an aggregate of 239,956, 173,294, 144,035, 110,035, 139,278 and
99,700 shares of restricted stock, respectively, having an aggregate value on
December 31, 1994 of $7,303,661, $5,274,636, $4,384,065, $3,349,190,
$4,239,274 and $3,034,619, respectively. Certain of such shares, net of
forfeitures, were subject to performance-based conditions on vesting and are
subject to forfeiture upon termination and restrictions on transfer prior to
stated dates. [See also the Corporate Performance Plan Activity Table.]
13
<PAGE>
Certain other shares are subject to restrictions on transfer until the
executive officer retires at or after age 60 and are subject to forfeiture
prior to age 60 in whole if such officer voluntarily terminates employment
with the Corporation and in part if such officer's employment is terminated
by the Corporation. Dividends are paid to such individuals on all shares of
restricted Common Stock held by them.
[3] During 1992, Mr. Gibson was granted an option to purchase 30,000 shares
of Corning Life Sciences Inc. ["CLSI"], a wholly- owned subsidiary of the
Corporation, pursuant to CLSI's 1991 Stock Option Plan [the "Plan"]. In
December 1993, the Plan was terminated. In consideration for the cancellation
in December 1993 of options to purchase an aggregate of 130,000 shares of
CLSI granted to Mr. Gibson under the Plan, Mr. Gibson was awarded 26,778
shares of Corning Common Stock. Of such shares, 50% are restricted as to
transfer until 1996 and 50% are restricted as to transfer until 1997. All
such shares were subject to forfeiture until December 31, 1994. The 26,778
shares are included in the holdings of Mr. Gibson set forth in footnote 2
above.
[4] Includes amounts contributed by the Corporation to the Investment Plan
and a non-qualified investment plan maintained by the Corporation to provide
salaried employees the benefits which would have been available to them
pursuant to the terms of the Corporation's Investment Plan but for
limitations on contributions to tax-qualified plans imposed pursuant to the
Employee Retirement Income Security Act: for 1994 $72,965 for Mr. Houghton,
$54,271 for Mr. Ackerman, $44,107 for Mr. Campbell, $38,036 for Dr. Duke,
$50,518 for Mr. Gibson and $11,094 for Mr. Thurman. Also includes 20% of a
$400,000 interest-free loan made to Mr. Thurman, together with imputed
interest thereon. Such loan, to be forgiven over a five-year period provided
he continues to be employed by CLSI, was made to assist Mr. Thurman in
relocating to the New Jersey area.
The Corporation has in place a severance policy pursuant to which it will
provide to all salaried employees upon the happening of certain stated events
compensation in amounts ranging between eight weeks [for employees with at
least one year of service] and fifty-two weeks [for employees with twenty or
more years of service]. Additionally, certain of the Corporation's officers
and other senior employees, including the five named executive officers
exclusive of Mr. Gibson, are entitled to receive up to two years of
compensation in light of the length of time anticipated in securing
comparable employment. The Corporation has provided written assurance to such
officers and senior employees, including the executive officers named in the
Summary Compensation Table, that such events would include a constructive
termination of employment as a result of a substantial change in such
employee's responsibilities, compensation levels, relocation and similar
matters following a change in the ownership and management of the
Corporation.
14
<PAGE>
OPTION/SAR GRANTS IN LAST FISCAL YEAR [1]
<TABLE>
<CAPTION>
Potential Realizable Value atAssumed
Annual Rates of Stock Price Appreciation
Individual Grants for Option Term
Number of % of Total
Securities Options
Underlying Granted to
Options Employees Exercise Expiration Gain at Gain at Gain at
Name Granted in Fiscal Year Price Date 0% 5% 10%
<S> <C> <C> <C> <C> <C> <C> <C>
James R.
Houghton 35,000 1.4% $30.00 12/6/2004 $0 $660,339 $1,673,430
Roger G.
Ackerman 28,000 1.1% 30.00 12/6/2004 0 528,271 1,338,744
Van C.
Campbell 25,000 1.0% 30.00 12/6/2004 0 471,671 1,195,307
David A. Duke 25,000 1.0% 30.00 12/6/2004 0 471,671 1,195,307
E. Martin
Gibson 0
Randy H.
Thurman 25,000 1.0% 30.00 12/6/2004 0 471,671 1,195,307
All
Shareholders
as a group N/A N/A N/A N/A 0 4,482,729,149 11,360,115,793
All Optionees
as a
group 2,511,163 100% 31.24 2004 0 49,335,986 125,027,075
Optionee Gain As % Of All Stockholders Gain 1.10% 1.10%
</TABLE>
[1] No SARs were granted.
[2] The Stock Option Agreements provide that all options are to become
exercisable on February 1, 1998 but only to the extent that the optionee
holds shares of the Corporation's Common Stock in an amount equal to
one-sixth of the shares subject to option.
[3] The dollar amounts set forth under these columns are the result of
calculations at 0% and at the 5% and 10% rates established by the Securities
and Exchange Commission and therefore are not intended to forecast future
appreciation of Corning's stock price. Corning did not use any alternative
formula for grant date valuation as it is unaware of any formula which would
determine with reasonable accuracy a present value based upon future unknown
factors.
[4] The exercise price shown to the right is a weighted average of option
prices relating to grants of options made on six occasions in 1994. No gain
to the optionees is possible without an appreciation in stock price, an event
which will also benefit all stockholders. If the stock price does not
appreciate, the optionees will realize no benefit.
15
<PAGE>
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL
YEAR AND FISCAL YEAR-END OPTION/SAR VALUES [1]
<TABLE>
<CAPTION>
Number of Securities
Underlying Unexercised Value of Unexercised
Options at In-the-Money Options
Fiscal Year End At Fiscal Year End
Shares
Acquired on Value
Name Exercise Realized Exerciseable Unexerciseable Exercisable Unexercisable
<S> <C> <C> <C> <C> <C> <C>
James R. Houghton 0 $0 206,000 182,000 $2,972,705 $144,375
Roger G. Ackerman 0 0 85,000 140,500 1,131,967 104,437
Van C. Campbell 0 0 104,424 115,000 1,388,212 84,687
David A. Duke 26,000 410,621 59,000 115,000 799,402 84,687
E. Martin Gibson 0 0 39,997 25,000 531,199 92,187
Randy H. Thurman 0 0 10,000 55,000 36,875 121,562
</TABLE>
[1] There are no SARs outstanding.
CORPORATE PERFORMANCE PLAN ACTIVITY TABLE
The Corporate Performance Plan [as earlier described on page 9] Activity
Table illustrates the number of performance-based shares awarded under such
Plan. The number of shares earned or which may be earned by the named
executive is determined by the achievement of specific return on equity and
earnings per share goals for the Corporation. The percentage of awards that
may be earned ranges from 0% to 150% of target.
In February 1996 the Compensation Committee will assess performance against
goals and determine the number of shares earned of those granted in December
1994. Once earned, such shares remain restricted as to transfer for two years
and subject to forfeiture upon termination of employment prior thereto.
<TABLE>
<CAPTION>
Number of Number Number Vesting
Grant Shares Performance of Shares of Shares Date of
Name Year Date Granted Period Forfeited Earned Earned Shares
<S> <C> <C> <C> <C> <C> <C> <C>
James R. Houghton 1995 12/94 17,500 1995 2/98
1994 12/93 17,500 1994 25,165 2/97
1993 12/92 16,000 1993 12,000 4,000 2/96
Roger G. Ackerman 1995 12/94 14,000 1995 2/98
1994 12/93 12,500 1994 17,975 2/97
1993 12/92 12,500 1993 9,375 3,125 2/96
Van C. Campbell 1995 12/94 12,500 1995 2/98
1994 12/93 10,000 1994 14,380 2/97
1993 12/92 10,000 1993 7,500 2,500 2/96
David A. Duke 1995 12/94 12,500 1995 2/98
1994 12/93 10,000 1994 14,380 2/97
1993 12/92 10,000 1993 7,500 2,500 2/96
16
<PAGE>
E. Martin Gibson 1995 12/94 1995 2/98
1994 12/93 12,500 1994 0 17,975 2/97
1993 12/92 2/96
Randy H. Thurman 1995 12/94 12,500 1995 2/98
1994 12/93 10,000 1994 0 12,095 2/97
</TABLE>
PENSION PLAN
The table below sets forth estimated annual benefits payable upon retirement.
A description of the formula by which such benefits are determined and the
estimated annual benefits payable upon retirement age for each of the named
executive officers follows the table.
<TABLE>
<CAPTION>
Years of Service
15 20 25 30 35 40
Remuneration
<S> <C> <C> <C> <C> <C> <C>
$100,000 $ 26,532 $ 36,041 $ 44,511 $ 52,981 $ 61,451 $ 69,921
200,000 56,532 76,041 94,511 112,981 131,451 149,921
300,000 86,532 116,041 144,511 172,981 201,451 229,921
400,000 116,532 156,041 194,511 232,981 271,451 309,921
500,000 146,532 196,041 244,511 292,981 341,451 389,921
600,000 176,532 236,041 294,511 352,981 411,451 469,921
700,000 206,532 276,041 344,511 412,981 481,451 549,921
800,000 236,532 316,041 394,511 472,981 551,451 629,921
900,000 266,532 356,041 444,511 532,981 621,451 709,921
1,000,000 296,532 396,041 494,511 592,981 691,451 789,921
1,100,000 326,532 436,041 544,511 652,981 761,451 869,921
1,200,000 356,532 476,041 594,511 712,981 831,451 949,921
</TABLE>
The Corporation maintains a Salaried Pension Plan, a defined benefit plan,
contributions to which are determined by the Corporation's actuaries and are
not made on an individual basis. Benefits paid under this Plan are based upon
career earnings [regular salary and cash awards paid under the Corporation's
Variable Compensation Plans] and years of credited service. The Salaried
Pension Plan provides that salaried employees of the Corporation who retire
on or after December 31, 1993 will receive pension benefits equal to the
greater of [a] benefits provided by a formula pursuant to which they shall
receive for each year of credited service an amount equal to 1.5% of annual
earnings up to the social security wage base and 2% of annual earnings in
excess of such base or [b] benefits calculated pursuant to a formula which
provides that retirees shall receive for each year of credited service prior
to January 1, 1994 an amount equal to 1% of the first $24,000 of average
earnings for the highest five consecutive years of annual earnings in the ten
years of credited service immediately prior to 1994 and 1.5% of such average
earnings in excess of $24,000. Effec
17
<PAGE>
tive upon commencement of employment, salaried employees may contribute to
the Salaried Pension Plan 2% of their annual earnings up to the social
security wage base. Such employees will receive for each year of credited
service after December 31, 1990 in lieu of the amount described in [a] above
an amount equal to 2% of annual earnings. The benefit formula is reviewed and
adjusted periodically for inflationary and other factors.
While the amount of benefits payable pursuant to the Salaried Pension Plan
and attributable to the Corporation's contributions is limited by the
provisions of the Employee Retirement Income Security Act, maximum annual
benefits calculated under the straight life annuity option form of pension
payable to participants at age 65, the normal retirement age specified in the
Plan, are illustrated in the table set forth above.
The Corporation maintains a non-qualified Executive Supplemental Pension Plan
pursuant to which it will pay to certain executives amounts approximately
equal to the difference between the benefits provided for under the
Corporation's Salaried Pension Plan and benefits which would have been
payable thereunder but for the provisions of the Employee Retirement Income
Security Act. The Corporation has established a trust to fund amounts payable
under the Executive Supplemental Pension Plan, certain portions of which are
presently funded and vested in individual partici- pants. It is estimated
that Messrs. Ackerman, Campbell, Duke, Gibson, Houghton and Thurman who have
33, 31, 32, 33, 32 and 1 years of credited service, respectively, would
receive each year if they worked to age 65, the normal retirement age
specified in the Salaried Pension Plan, the following amounts under the
Salaried Pension Plan and the Executive Supplemental Pension Plan: $462,558,
$367,045, $337,312, $453,571, $678,844, and $268,416, respectively.
Receipt of Stockholder Proposals
Any stockholder proposal intended to be presented at the 1996 Annual Meeting
and included in the Corporation's Proxy Statement and Proxy relating to that
meeting must be received by the Corporation at One Riverfront Plaza, Corning,
New York 14831; Attention: The Secretary not later than November 19, 1995.
Directors' Compensation and Other Matters Relating to Directors
Each director of the Corporation, other than a director who is an employee of
the Corporation, receives $20,000 for service as a director and is also paid
$750 for each meeting of the Board or any committee thereof which he attends.
However, if a director attends more than one such meeting on any given day,
he is paid $500 for each additional meeting. Members of the International
Committee, which met twice in 1994, were paid an additional $1,000 for
attending such meeting. In lieu of a meeting fee, chairmen of committees of
the Board are paid a retainer ranging from $3,000 to $6,500, depending upon
the committee which the director chairs. Pursuant to a Deferred Compensation
Plan for Directors adopted by the Corporation in 1983, each director may
elect to defer until a date specified by him receipt of all or a portion of
his compensation. Such Plan provides that amounts deferred shall be paid only
in cash and while deferred may be allocated to [i] a cash account upon which
amounts deferred may earn interest, compounded quarterly, at the prime rate
of Citibank, N.A. in effect on certain specified dates, [ii] a market value
account, the value of which will be based upon the market value of the
Corporation's Common Stock from time to time, [iii] a book value account, the
value of which will be based upon the book value of the Corporation's Common
Stock established on an annual basis, or a combination of such accounts. At
December 31, 1994 nine directors had elected to defer compensation pursuant
to such Plan. Pursuant to the Restricted Stock Plans for Non-Employee
Directors, the Corporation during 1994 issued to each non-employee director
elected in 1994 400 shares of the Corporation's Common Stock for each year
specified in the term of service for which such director was elected, subject
to forfeiture and restrictions on transfer, and issued 4,000 shares to one
non-employee director newly elected in October 1994, subject to forfeiture
and restrictions on transfer.
18
<PAGE>
The Corporation has established a Directors' Charitable Giving Program funded
by insurance policies on the lives of the directors. In 1994 the Corporation
paid a total of $396,792 in premiums on such policies. Upon the death of a
director, the Corporation will donate $1,250,000 [on behalf of a non-employee
director] and $1,000,000 [on behalf of an employee director] to one or more
qualified charitable organizations recommended by such director and approved
by the Corporation. The directors derive no financial benefit from the
Program as all charitable deductions and cash surrender value of life
insurance policies accrue solely to the Corporation. All directors, other
than Mr. Foster, currently participate in the Program.
The Board of Directors of the Corporation held during 1994 five regularly
scheduled meetings and one special meeting. Each director, other than Messrs.
Hennessy and Jordan, attended at least 75% of all such regularly scheduled
meetings and the meetings of the committees of which each was a member.
The Corporation has audit, compensation and nominating committees composed of
members of the Board of Directors.
The Audit Committee, composed of Messrs. O'Connor, Barker, Jordan and
Smithburg and Ms. Rein, met four times during 1994. It recommends the firm of
independent accountants to conduct the annual examination of the
Corporation's consolidated financial statements, confers with such
accountants and reviews the scope of the examination and brings to the entire
Board of Directors for review those items relating to such examination or to
accounting practices which the Audit Committee believes merit such review.
The Compensation Committee, composed of Messrs. Kinnear, Jordan, O'Connor and
Stone, met five times during 1994. It makes recommendations to the Board of
Directors with respect to the compensation of officers and executive
employees of the Corporation and administers the Corporation's Variable
Compensation Plan, Employee Equity Participation Program and the Executive
Supplemental Pension Plan. The Nominating Committee, composed of Messrs.
Conable, Houghton, Kinnear and Rosovsky, met twice during 1994 and proposed
the election of John H. Foster in October, 1994 as well as the nominees for
election as directors at the Annual Meeting of Stockholders to be held on
April 27, 1995. It reviews, considers and proposes nominees for election as
directors of the Corporation and makes such other proposals with respect to
the organization, size and composition of the Board of Directors as it deems
advisable. While the Committee may consider persons nominated by
stockholders, it has no explicit procedures in this regard.
Mr. Jordan, a director of the Corporation and a member of the Compensation
Committee, is a partner of the law firm of Akin, Gump, Strauss, Hauer & Feld,
which rendered services to the Corporation during 1994.
Other Matters
Corning Consumer Products Company, a wholly- owned subsidiary, leases office
space in Corning, New York from Mr. Robert L. Ecklin, an executive officer.
The average base monthly rental under such lease, which expires on December
31, 1995, is currently $3,952. The Corporation also leases other office space
in Corning, New York owned by Mr. Ecklin. During 1994 the Corporation paid an
average base monthly rental of $20,270 for such space. The lease expires on
June 30, 1995. In December 1994 Clinical Pathology Inc., a wholly-owned
subsidiary of the Corporation, entered into an agreement to lease office and
laboratory space located in Corning, New York from Mr. Ecklin for a two-year
term commencing January 1, 1995 at a base monthly rental of $892.
During 1994, in addition to the loan described in footnote 4 to the Summary
Compensation Table, ten executive officers of the Corporation owed the
Corporation a maximum aggregate amount of $730,383, which remained
outstanding on December 31, 1994, and paid interest on such amounts at 6% per
annum.
Section 16[a] of the Securities Exchange Act of 1934 requires Corning's
directors and certain of its officers to file reports of their ownership of
Corning stock and of changes in such ownership with the Secu
19
<PAGE>
rities and Exchange Commission [the "SEC"] and the New York Stock Exchange.
SEC regulations also require Corning to identify in this proxy statement any
person subject to this requirement who failed to file any such report on a
timely basis. Larry Aiello, Jr., Kenneth W. Freeman, Sandra L. Helton and
John W. Loose, officers of the Company, each inadvertently filed late one
such report disclosing the acquisition of shares under employee benefit plans
or the gift of shares to charity.
The Corporation has purchased insurance from National Union Fire Insurance
Company, Pittsburgh, Pennsylvania, Federal Insurance Company and A.C.E.
Insurance Company [Bermuda] Ltd. providing for reimbursement of directors and
officers of the Corporation and its subsidiary companies for costs and
expenses incurred by them in actions brought against them in connection with
their actions as directors or officers, including actions as fiduciaries
under the Employee Retirement Income Security Act of 1974. The insurance
coverage, which expires in May 1995, costs $1,571,000 on an annual basis,
which will be paid by the Corporation.
At the meeting of the Corporation's Board of Directors held on February 1,
1995, the Board appointed Price Waterhouse LLP as the independent accountants
for the Corporation for its 1995 fiscal year, pursuant to the recommendation
of the Audit Committee. Audit services performed by Price Waterhouse LLP for
the fiscal year ended January 1, 1995 consisted of examination of the
consolidated financial statements of the Corporation, limited review of the
unaudited quarterly consolidated financial statements and limited assistance
and consultation in connection with filings with the Securities and Exchange
Commission.
The Corporation expects representatives of Price Waterhouse LLP to be present
at and available to respond to appropriate questions which may be raised at
the Annual Meeting. Representatives of Price Waterhouse LLP will have the
opportunity to comment on the Corporation's financial statements if they so
desire.
The cost of the solicitation of Proxies will be borne by the Corporation. In
addition to solicitation of the Proxies by use of the mails, some of the
directors, officers and regular employees of the Corporation, without extra
remuneration, may solicit Proxies personally or by telephone or telegraph.
The Corporation has retained Georgeson & Co. Inc., at a cost of $12,000, to
assist in soliciting Proxies in connection with the Annual Meeting. The
Corporation may also request brokerage houses, nominees, custodians and
fiduciaries to forward soliciting material to beneficial owners of shares
held of record. The Corporation will reimburse such persons for their
expenses in forwarding soliciting material.
By order of the Board of Directors.
A. John Peck, Jr.
Secretary
March 8, 1995
20
<PAGE>
EPrinted on recycled paper using soybean ink
[logo]
Notice of 1995 Annual
Meeting of Stockholders
and Proxy Statement
[recycle logo]
21
<PAGE>
CORNING PRIVATE
Proxy Solicited on Behalf of The Board of Directors For The Annual Meeting of
Stockholders--April 27, 1995
The undersigned appoints James R. Houghton, Roger G. Ackerman and Van C.
Campbell, and each of them, as proxies, with full power of substitution and
revocation, to vote, as designated on the reverse side hereof, all the Common
Stock of Corning Incorporated which the undersigned has power to vote, with all
powers which the undersigned would possess if personally present, at the annual
meeting of stockholders thereof to be held on April 27, 1995, or at any
adjournment thereof.
Unless otherwise marked, this proxy will be voted FOR the election of the
nominees named.
___ Check here for address change.
New Address: ______________________
___________________________________
___________________________________
___ Check here if you plan to
attend the meeting.
PLEASE VOTE, SIGN, DATE AND RETURN THIS PROXY CARD PROMPTLY USING THE ENCLOSED
ENVELOPE.
<PAGE>
The Board of Directors recommends a vote FOR all nominees for directors.
Nominees: FOR WITHHOLD
Roger G. Ackerman;
David A. Duke; John H. ___ ___
Foster; Catherine A.
Rein and William D.
Smithburg ___
FOR ALL (except Nominee(s)
written below):
________________________________________________________________________
Signature(s)_____________________________ Dated:_________, 1995
Please sign exactly as name appears hereon. Joint owners should each sign. Where
applicable, indicate official position or representative capacity.
