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SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or
Section 240.14a-12
CPC INTERNATIONAL INC.
.................................................................
(Name of Registrant as Specified In Its Charter)
.................................................................
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1),
14a-6(i)(2) or Item 22(a)(2) of Schedule 14A.
[ ] $500 per each party to the controversy pursuant to Exchange
Act Rule 14a-6(i)(3).
[ ] Fee computed on table below per Exchange Act Rules
14a-6(i)(4) and 0-11.
1) Title of each class of securities to which transaction
applies:
.................................................................
2) Aggregate number of securities to which transaction
applies:
.................................................................
3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11 (Set forth the
amount on which the filing fee is calculated and state how it was
determined):
.................................................................
4) Proposed maximum aggregate value of transaction:
.................................................................
5) Total fee paid:
.................................................................
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by
Exchange Act Rule 0-11(a)(2) and identify the filing for
which the offsetting fee was paid previously. Identify the
previous filing by registration statement number, or the
Form or Schedule and the date of its filing.
1) Amount Previously Paid:
.................................................................
2) Form, Schedule or Registration Statement No.:
.................................................................
3) Filing Party:
.................................................................
4) Date Filed:
.................................................................
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[LOGO OF CPC INTERNATIONAL]
INTERNATIONAL PLAZA, P.O. BOX 8000, ENGLEWOOD CLIFFS, NEW JERSEY 07632-9976
March 13, 1996
Dear Stockholder:
On behalf of the Board of Directors, I am pleased to invite you to your
Company's 1996 annual meeting of stockholders to be held in Alpine, New Jersey,
on Thursday, April 25, 1996 at 9:30 A.M., local time. We hope that many of you
will be able to attend.
The matters to be acted upon by our stockholders are set forth in the
notice of annual meeting. At the conclusion of the meeting, we will hold an
informal session to present a brief report on the Company's business and respond
to your questions.
Whether or not you plan to attend the meeting, please sign, date and mail
your proxy card as soon as possible in the postpaid envelope enclosed. A summary
of the proceedings will be included in the midyear report.
If you plan to attend, please complete the reservation form on the inside
back cover and return it to us.
Sincerely yours,
/s/ Charles R. Shoemate
Charles R. Shoemate
Chairman, President and
Chief Executive Officer
[RECYCLED LOGO]
Printed on Recycled Paper
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CPC INTERNATIONAL INC.
INTERNATIONAL PLAZA
P.O. BOX 8000
ENGLEWOOD CLIFFS, N.J. 07632-9976
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
The annual meeting of stockholders of CPC International Inc. will be held
at Tamcrest Country Club, Route 9W, Montammy Drive, Alpine, New Jersey, on
Thursday, April 25, 1996 at 9:30 A.M., local time, for the following purposes:
1. To elect four directors, each for a term of three years.
2. To consider and take action upon the appointment of independent
auditors for the Company for 1996.
3. To transact such other business, if any, as may properly come
before the meeting.
Stockholders of record at the close of business on February 29, 1996 will
be entitled to vote at the meeting, and the holders of a majority of the issued
and outstanding shares of the capital stock will constitute a quorum for the
transaction of business.
WHETHER OR NOT YOU EXPECT TO ATTEND THE MEETING, PLEASE SIGN, DATE AND RETURN
YOUR PROXY CARD PROMPTLY.
By order of the Board of Directors,
/s/ John B. Meagher
John B. Meagher
Secretary
March 13, 1996
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TABLE OF CONTENTS
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PAGE
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<S> <C>
Proxy Solicitation and Voting Information................................................................. 1
Corporate Governance...................................................................................... 2
Stockholder Return Comparison............................................................................. 8
Compensation and Nominating Committee Report on Executive Compensation.................................... 9
Executive Compensation and Stock Ownership Tables......................................................... 13
Matters to be Acted Upon:
Proposal 1.
Election of Directors............................................................................... 18
Proposal 2.
Appointment of Auditors............................................................................. 24
Other Business............................................................................................ 24
Proposals for the 1997 Annual Meeting..................................................................... 25
Additional Information.................................................................................... 25
</TABLE>
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CPC INTERNATIONAL INC.
INTERNATIONAL PLAZA
P.O. BOX 8000
ENGLEWOOD CLIFFS, N.J. 07632-9976
PROXY STATEMENT
This proxy statement, the accompanying proxy and the Company's annual
report to stockholders for 1995 are being mailed on March 13, 1996 to all
stockholders of record at the close of business on February 29, 1996, in
connection with the annual meeting of stockholders to be held April 25, 1996 or
any adjournment of it.
PROXY SOLICITATION AND VOTING INFORMATION
The authorized capital stock of the Company consists of 900,000,000 shares
of common stock ($.25 par value) and 25,000,000 shares of preferred stock ($1.00
par value). On February 29, 1996, there were issued and outstanding and entitled
to be voted 145,611,114 shares of common stock and 2,133,740 shares of
convertible preferred stock ('ESOP preferred stock') held by the trustee of the
employee stock ownership plan ('ESOP') component of the Company's
Savings/Retirement Plan for Salaried Employees ('Savings Plan'). Each share of
common stock and ESOP preferred stock entitles the holder to cast one vote on
each matter to be voted upon at the annual meeting. If a stockholder is a
participant in the CPC International Stock Fund or ESOP component of the Savings
Plan, the proxy will also serve as a voting instruction to the trustee of the
Savings Plan. Shares held in either the CPC International Stock Fund or the ESOP
component of the Savings Plan as to which no voting instructions have been
received (as well as unallocated shares held by the trustee) will be voted by
the trustee in the same proportion as the shares for which instructions have
been received. If a stockholder is a participant in the Company's Automatic
Dividend Reinvestment Plan, the shares of common stock shown on the proxy
include the number of full shares held in the Plan account, as well as shares
registered in the stockholder's name.
Proxies marked as abstaining on any matter to be acted upon, and votes
withheld by brokers on non-routine matters in the absence of instructions from
beneficial owners (broker non-votes), will be treated as present at the meeting
for purposes of determining a quorum but will not be counted as votes cast on
such matters.
The accompanying proxy is solicited by and on behalf of the Board of
Directors of the Company. All shares of stock entitled to be voted which are
represented by valid and unrevoked proxies will be voted in accordance with the
instructions thereon. In the absence of such instructions, the shares will be
voted as recommended by the Board of Directors or, in the absence of such
recommendation, in the discretion of the persons named in the accompanying
proxy. A proxy may be revoked at any time before it is voted at the annual
meeting by written notice of revocation to the Secretary of the Company, a valid
proxy bearing a later date, or vote by ballot at the meeting.
The solicitation of proxies is being made by mail and may also be made by
telephone, other electronic means, or in person using the services of directors,
executive officers, and regular employees of the Company. The cost of the
solicitation will be paid by the Company,
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which has retained D. F. King & Co., Inc., 77 Water Street, New York, New York
10005, to assist in the solicitation for a fee estimated not to exceed $11,000
plus reasonable expenses. On behalf of the Company, D. F. King & Co., Inc. will
reimburse brokers, banks and others who are record holders of the Company's
stock for reasonable expenses incurred in obtaining voting instructions from the
beneficial owners of such stock.
CORPORATE GOVERNANCE
The Board of Directors recognizes the breadth of its duties under the law
and good corporate governance practice, including its fiduciary duties to the
stockholders. Within these broad overall duties, the Board believes that certain
continuing oversight responsibilities should have priority on its agenda.
Subject to regular review, these responsibilities include the following:
STRATEGY AND PERFORMANCE, including the longer-term vision and strategies
of the Company, implementation of the strategies in the operating
divisions, and significant acquisitions and other investments in support
of the strategies; and the operating plans and performance of the Company
and the divisions.
MANAGEMENT OVERSIGHT, including the performance of the chief executive
officer and other members of senior management, management organization
and development, senior management succession planning, and senior
management compensation.
BOARD EFFECTIVENESS, including the structure of the Board and its
Committees, the governance practices and performance of the Board, and
the flow of information to the directors.
ETHICAL CONDUCT AND LEGAL COMPLIANCE
ACCOUNTING AND FINANCIAL CONTROLS
FINANCIAL STRUCTURE AND PRESERVATION OF ASSETS
STRATEGY AND PERFORMANCE
The Board conducts an annual review of the longer-term business strategies
of the Company and each of its six operating divisions, and oversees the
management structures designed to formulate recommended strategies and to
implement strategies endorsed by the Board.
The strategic management process begins with a statement of the Company's
vision and the strategies that support it, which is developed by
management and reviewed by the Board. From this vision and strategy
statement, the operating divisions develop strategic plans that reflect
their particular business and regional situations. These division plans
are reviewed by senior management and integrated into the strategic plans
which are presented to the Board.
A corporate strategy council at the senior management level works with
the chief executive officer and the Board in setting corporate strategic
priorities for achieving superior stockholder value. The corporate
strategy council is responsible for recommending strategic initiatives to
the Board, identifying the resources required to
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implement them, and ensuring that key strategic issues at the corporate
and operating division levels are identified and addressed.
The Board reviews annually capital expenditures which support the
strategies and a report evaluating the performance of businesses recently
acquired by the Company. Each business is rated on the basis of financial
and marketing criteria compared to projections established when the
business was acquired.
From time to time during the year, the Board conducts reviews of
particular businesses within the operating divisions.
The Board also conducts an annual review of the operating results for the
preceding year, and the business plan and goals for the next year, for each of
the Company's operating divisions and for the Company as a whole.
MANAGEMENT OVERSIGHT
A principal function of the Board is to evaluate the performance of the
chief executive officer and other executive officers. This evaluation process
occurs regularly throughout the year, in formal and informal ways.
A formal performance evaluation occurs in January of each year. It begins
with a presentation to the Board by the chief executive officer of the
operating results for the previous year compared to the goal, and the
operating plan and goal for the new year. The outside directors, meeting
in executive session, then receive and discuss a report from the chief
executive officer on the performance of senior management, management
organization and development, and executive succession planning. Finally,
with the Chairman of the Compensation and Nominating Committee presiding
and in the absence of the chief executive officer, the outside directors
review his performance. The Chairman of the Compensation and Nominating
Committee subsequently meets with the chief executive officer to discuss
the evaluation by the outside directors. The evaluation focuses on major
responsibilities of the chief executive officer, which include the
following:
STRATEGIC LEADERSHIP. Leading management in developing and
implementing appropriate long-term business strategies which are
supported by management and the Board.
CORPORATE PERFORMANCE. Leading in the development and execution of
operating plans and systems designed to achieve the best possible
financial performance relative to peer companies and relative to the
potential of the Company's businesses.
ORGANIZATION. Building an effective organization structure and
management development process to support the strategies and
operating plans of the Company; maintaining a corporate climate to
attract, retain and motivate a diverse work force; and insuring that
an effective chief executive officer succession plan is in place.
CORPORATE GOVERNANCE. Setting the 'tone at the top' to promote the
highest ethical practices and fulfill social responsibilities, and
overseeing the formulation
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and implementation of major corporate policies; and recommending
improvements in the governance practices of the Board.
The outside directors evaluate the chief executive officer's accomplishments
in each of these categories in the preceding year, measured against goals
established at the beginning of the year.
Immediately following the January Board meeting, the Compensation and
Nominating Committee reviews and approves the compensation of the chief
executive officer and the other executive officers, including annual
bonuses for the preceding year, proposals for salary increases to become
effective during the ensuing year, and long-term incentive awards.
The evaluation of the chief executive officer is an on-going process
which also occurs during regularly scheduled Board meetings, in
one-on-one meetings between the chief executive officer and the outside
directors and in observations of corporate reputation and involvement in
various business communities.
The Board has established a policy encouraging its members to visit
principal facilities of the Company. This policy is intended:
To give outside directors the opportunity to exercise a more informed
judgment concerning the business operations of the Company.
To promote increased contact between outside directors and senior
management by enabling the directors to meet with managers at their own
base of operations.
To enable outside directors to report to the Board personal observations
and reactions resulting from such visits.
Outside director access to management is further fostered by:
Designation of corporate officers as the Committee Executives to work
directly with the Chairman of each Committee of the Board.
An outside director orientation program.
Attendance by outside directors at senior management meetings.
BOARD EFFECTIVENESS
The Board of Directors presently consists of twelve members, of whom nine
are outside directors. Each of the outside directors, in the opinion of the
Board, is independent of management and free from any relationship that would
interfere with the exercise of independent judgment, and is eligible to serve as
a member of the Audit Committee or the Compensation and Nominating Committee
under the applicable rules and regulations of the Securities and Exchange
Commission, the New York Stock Exchange and the Internal Revenue Service. The
facts bearing on the independence of each outside director are reviewed annually
by the Audit Committee and reported to the full Board.
The Company's corporate governance process is the subject of regular review
by the Board.
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The Board conducts an annual evaluation of its own structure and
performance, including an assessment of the appropriateness and
effectiveness of its governance practices.
Regular executive sessions are held at the end of Board meetings to
permit frank and unstructured discussions between the outside directors
and the chief executive officer. These discussions frequently relate to
governance procedures and items for the Board's agenda.
Periodic 'one-on-one' meetings are held by the chief executive officer
and each outside director, to provide additional opportunity for private
dialogue.
Each year, the directors consider and approve specific items to be placed
on the agendas for meetings of the Board for the year. In advance of each
meeting, management distributes to the directors the agenda and financial and
other business information, including background summaries of presentations to
be made at the meeting, to facilitate full and informed discussion of the agenda
items at the meeting.
Annually, the Compensation and Nominating Committee reviews, against
established criteria, the performance of incumbent directors whose terms are
expiring prior to recommending to the Board the nominees for election as
directors at the annual meeting of stockholders. The review process is conducted
according to the following performance guidelines:
DIRECTOR'S PRIMARY RESPONSIBILITIES. A director is expected to commit to
serve the Company in the role described in the By-laws, and in the
Corporate Governance section of the proxy statement.
ATTENTIVENESS AND ATTENDANCE. A director is expected to maintain regular
attendance at meetings of the Board of Directors and its Committees, and
to have reviewed materials distributed in advance.
PARTICIPATION AND COOPERATION. A director is expected to actively
participate in discussions and debate in Board and Committee meetings,
with a sense of teamwork and corporate identity.
INSIGHT AND INPUT. A director is expected to provide advice and counsel
to the chief executive officer and other senior executives.
STAKEHOLDERS. A director should exhibit respect for his or her duties to
the stockholders, employees and the other communities served by the
Company.
CHANGE IN PRINCIPAL EMPLOYMENT. A change in principal employment is a
factor that will be considered by the Committee when determining whether
to recommend the reelection of an incumbent director.
ETHICAL CONDUCT AND LEGAL COMPLIANCE, ACCOUNTING AND FINANCIAL CONTROLS,
FINANCIAL STRUCTURE AND PRESERVATION OF ASSETS
The Board has delegated to certain of its Committees oversight
responsibilities for ethical conduct and legal compliance, accounting and
financial controls, and financial structure and preservation of assets. A
description of each Committee is presented in the following section.
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COMMITTEES OF THE BOARD
To assist it in discharging its responsibilities, the Board delegates to
its four Committees the authority to consider certain matters and report to the
Board with appropriate recommendations.
Each Committee is chaired by an outside director.
The chairmanship and membership of all of the Committees are rotated on a
regular basis to give the directors a broader knowledge of the Company's
affairs.
The Board conducts an annual review of the charter of each Committee.
Each Committee establishes its own agendas for the year, and conducts a
year-end evaluation of its performance by comparing the topics considered
at meetings with its charter as established by the Board.
Oral reports of Committee activities are given at each Board meeting and
minutes of Committee meetings are sent to all of the directors.
The CORPORATE AFFAIRS COMMITTEE, which oversees ETHICAL CONDUCT AND LEGAL
COMPLIANCE, is composed of a majority of outside directors. It held four
meetings in 1995. The Committee reviews policies and programs of the Company
relating to customer and consumer relations, employee relations, health, safety
and the environment, community relations, compliance with laws, disclosure of
information and insider trading, and business ethics. It also reviews major
litigation, crisis management organization, and programs for communication with
investors, governments and the public.
The AUDIT COMMITTEE, which is responsible for ACCOUNTING AND FINANCIAL
CONTROLS, is composed entirely of outside directors. It held four meetings in
1995. Among its functions are to review the scope and results of the annual
audit, approve the non-audit services rendered by the independent auditors and
consider the effect thereof on the independence of the auditors, and recommend
to the Board appointment of independent auditors for the ensuing year subject to
ratification by the stockholders.
The Committee also reviews the proposed financial statements for the annual
report to stockholders, accounting policies, internal control systems and
internal auditing procedures, and the process by which unaudited quarterly
financial information is compiled and issued. Both the independent auditors and
the corporate general auditor meet privately with the Committee on a regular
basis.
The Committee reviews annually the independence of each outside director.
The FINANCE COMMITTEE, which is responsible for FINANCIAL STRUCTURE AND
PRESERVATION OF ASSETS, is composed of a majority of outside directors. It held
four meetings in 1995. The Committee reviews policies and practices of the
Company affecting its financial structure and position, short- and long-term
financing, foreign exchange management, financial derivatives including
commodities and hedging, capital expenditures, dividends, insurance coverage and
taxes. It recommends to the Board the appointment of trustees and investment
managers under employee benefit plans and reviews their performance, and
recommends the annual contributions by the Company to fund such plans.
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The COMPENSATION AND NOMINATING COMMITTEE, which is composed entirely of
outside directors, held five meetings in 1995. The Committee approves the
compensation of all executive officers and administers executive incentive
compensation plans, utilizing the advice of outside compensation consultants. It
also reviews employee benefit plans and recommends to the Board proposals for
adoption, amendment or termination of such plans. The Committee recommends to
the Board of Directors the compensation arrangements for outside directors, and
administers the compensation plans for outside directors.
This Committee develops criteria for Board membership and, with the
assistance of outside consultants, considers candidates for membership on the
Board. The Committee also reviews the performance of incumbent directors whose
terms are expiring prior to recommending to the Board the nominees for election
as directors at the annual meeting of stockholders.
Any stockholder who wishes to recommend a candidate for consideration by
the Committee as a nominee for director may do so by writing to the Secretary of
the Company and furnishing a statement of the candidate's experience and
qualifications.
BOARD MEETINGS AND COMPENSATION
The Board held eleven meetings in 1995, and each of the directors attended
at least 75 percent of the aggregate of the meetings of the Board and Committees
of the Board of which they are members. Attendance of all directors at such
meetings averaged 94 percent.
Outside directors receive an annual retainer of $44,000, and fees of $1,000
for each Board and Committee meeting attended and for each day spent visiting
other Company facilities. Outside directors who serve as chairmen of the
Committees of the Board receive an additional annual retainer of $3,000.
Employee directors do not receive any additional compensation for services in
that capacity.
Two-thirds of the annual retainer is paid in cash, and one-third is paid in
the form of common stock of the Company which is mandatorily deferred until
retirement under the Deferred Compensation Plan for Outside Directors. This Plan
further provides that all or part of a director's cash compensation may, at the
director's option, be deferred, invested in common stock of the Company or in an
interest-bearing account, and paid after retirement from the Board.
The Company has a Retirement Income Plan for Outside Directors whereby
outside directors who have served as such for five or more years will receive,
upon retirement from the Board, an annual payment equal to the rate of annual
cash retainer in effect on the date of their retirement, payable for a period
equal to the shorter of the time served as a director or the remainder of the
retired director's life.
Pursuant to the Board's policy on tenure of directors, outside directors
and former chief executive officers will not be renominated for election as a
director after attaining age 70, and other employee directors will not be
renominated following retirement as an officer.
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STOCKHOLDER RETURN COMPARISON
The following graph compares the yearly percentage change in the cumulative
total return on the Company's common stock with the cumulative total return of
the Standard & Poor's Foods Index (the 'S&P Foods Index'), the Standard & Poor's
500 Stock Index (the 'S&P 500 Index') and a Peer Group Index of food and
food-related companies. As explained in the Compensation and Nominating
Committee Report on Executive Compensation on pages 10 and 11, the companies in
the Peer Group were approved by the Committee for measurement of the Company's
performance during the 1995 and 1996 performance cycles established under the
1993 Stock and Performance Plan. These cycles will terminate at the end of 1998
and 1999, respectively. The historical performance of the Peer Group Index,
weighted for market capitalization, is shown as a reference. The Peer Group
consists of Archer-Daniels-Midland Company, Campbell Soup Company, Con Agra,
Inc., General Mills, Inc., H.J. Heinz Company, Hershey Foods Corporation, Hormel
Foods Corporation, Kellogg Company, McCormick & Company, Incorporated, The
Quaker Oats Company, Sara Lee Corporation, Smucker (J.M.), Co., Unilever N.V.,
and Wm. Wrigley Jr. Company. The graph assumes that $100 was invested on
December 31, 1990 in each of CPC common stock, the S&P Foods Index, the S&P 500
Index, and the Peer Group Index, and that all dividends were reinvested.
<TABLE>
<CAPTION>
1990 1991 1992 1993 1994 1995
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<S> <C> <C> <C> <C> <C> <C>
CPC International Inc. 100 111.48 127.95 123.89 142.40 187.91
S&P Foods Index 100 145.88 145.54 133.56 149.29 190.44
S&P 500 Index 100 130.47 140.41 154.56 156.60 215.45
Peer Group Index 100 147.01 149.36 142.11 153.03 192.69
------------------------------------------------------------------------------------
</TABLE>
[PERFORMANCE GRAPH]
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COMPENSATION AND NOMINATING COMMITTEE REPORT
ON EXECUTIVE COMPENSATION
GENERAL DISCUSSION OF SHORT-TERM COMPENSATION
The Company's short-term compensation program, consisting of base salary
and annual bonus, is administered by using the concepts of a salary range and
target bonus for each executive position. Salary ranges and bonus targets are
established reflecting data from salary surveys of companies in the consumer
goods and food sectors. The companies surveyed are those with which the Company
competes in the marketplace in business results, for human resources, and in
stockholder return. These companies are similar but not identical to those in
the S&P Foods Index and the Peer Group Index in the Stockholder Return
Comparison graph on page 8 because survey data is not available for all of such
Index companies.
Each salary range has a midpoint which represents the average salary for
comparable surveyed positions, and a range that varies about 27% above and below
midpoint for the highest level position and about 24% for the lowest level
position. An individual executive's progress through and position in the salary
range depend primarily upon individual performance and time in the job. Annual
bonus targets have also been established for each position as a percentage of
salary. These target annual bonus levels are at the middle range of bonus
targets for similar positions in the surveyed companies. The size of bonus
actually paid depends upon the performance of the Company, the business unit,
and the individual. The principal factors used in assessing such performance
include earnings per share growth at the Company level; sales and operating
income growth at both the Company and business unit levels; and achievement at
the business unit and individual levels of agreed-upon objectives under the
'balanced scorecard' performance system described below. The relative importance
given each of these factors in determining bonuses is discretionary on the part
of the Committee and may vary by individual position and from year to year. In
addition to surveys of competitive practice, the Committee, which consists
entirely of outside directors, periodically uses independent consultants to
review these salary ranges and bonus targets for accuracy and appropriateness,
and to review the appropriateness of compensation actually paid. It is the
Company's objective to be fully competitive in salaries and bonuses paid
(generally at compensation survey average levels) with companies with which it
competes.
BASIS FOR SPECIFIC SHORT-TERM COMPENSATION ACTIONS
The base salaries in 1995 of the five highest paid executive officers named
in the Summary Compensation Table on page 13, vary from 17% below to 8% above
midpoint of their respective ranges for that year. As noted earlier, the salary
range midpoint for a position represents the average salary for that position
within the surveyed group of companies. In the salaries reported in the Table,
variances from midpoint correlate to individual performance and time in
position. In the Committee's opinion, Company base salaries are well within
competitive norms and appropriately reflect individual contribution and impact
of the position upon Company results.
Bonuses for executive officers with corporate responsibilities reflect
overall corporate performance as well as individual performance. Bonuses for
executive officers with operations responsibilities primarily reflect business
unit performance, but also reflect
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corporate performance as well as individual performance. After adjusting for
special items, earnings per share in 1995 were up 16%, operating income
increased 14%, volumes were up 9%, and return on equity was about 28%. Based on
these results and respective business unit results, and relative to the surveyed
companies referred to above, bonus awards for executive officers are appropriate
and well within competitive norms. Bonuses for the five highest paid executive
officers range from about 3.6% below target bonus to 11.9% above target bonus,
and total bonuses for all executive officers increased 26.1% over the previous
year. These awards are appropriate in view not only of strong increases in
volumes, operating income, and earnings per share, but also in view of these
increases in relation to the results of competitor companies.
Specifically with regard to the chief executive officer, Mr. Shoemate, the
Committee authorized a salary increase effective April 1, 1995 equating to 7.0%
on an annualized basis, and a bonus for 1995 of $600,000, representing 76.9% of
his salary at the time of the award compared to a target bonus of 65%. In
approving the salary increase, the Committee considered Mr. Shoemate's position
in his salary range, and both the salary increase and the bonus award were based
on evaluations of his performance conducted by all the outside directors, using
the process and performance criteria described on pages 3 and 4. The evaluation
of Mr. Shoemate's performance for 1995 reflected in particular his leading the
Company to achieve strong absolute and competitive financial results; his
strategic leadership in establishing the Company's vision to become 'The Best
International Food Company in the World' and progressing toward that vision by
implementing the supporting strategies; his establishment and implementation of
a 'balanced scorecard' performance system focusing all levels of management on
strategic business 'drivers' including customer satisfaction, best business
practices, people development, and innovation and learning, in order to foster
superior future financial results; and his implementation of sound and effective
systems of corporate governance.
GENERAL DISCUSSION OF LONG-TERM COMPENSATION
The Company's long-term compensation program consists of annual awards of
performance units and stock options under the Stock and Performance Plan. The
number of options granted is equal to the number of performance units. For a
more detailed description of how these tandem awards work, refer to footnote (1)
to the Option Grants table on page 14. The size of performance awards granted
depends upon the individual's performance, the size of awards previously granted
and, to a lesser extent, time in position. The weight given to each factor may
vary by individual and from year to year in the Committee's discretion. The size
of awards is generally in the mid-range of long-term compensation practices
among surveyed consumer goods and food sector companies. Competitiveness is
assessed by independent consultants' evaluations of survey data. Because of the
wide range of approaches to long-term compensation, companies surveyed for this
purpose are similar but not identical to those surveyed for short-term
compensation.
Earning of awards depends entirely upon the Company's stockholder return
(stock price appreciation plus dividends paid) compared to a group of food and
other consumer products companies with which the Company believes it competes
for investors. Each year the Committee reviews and approves the companies to be
included in the comparator group for the performance cycle established in that
year. The comparator group approved for the cycles
10
<PAGE>
<PAGE>
established in 1995 and 1996 is the Peer Group described under 'Stockholder
Return Comparison' on page 8. To the extent that performance awards are earned,
an equivalent number of the options granted in tandem are cancelled. The value
of the award earned is dependent upon the value of Company stock and its price
appreciation from the beginning to the end of the four-year performance cycle.
Payments are made at the end of the four-year cycle.
BASIS FOR SPECIFIC LONG-TERM COMPENSATION ACTIONS
Award payments made in January 1996 and reported in the Summary
Compensation Table on page 13 reflect annual and cumulative stockholder results
over a four-year period beginning January 1, 1992 and ending December 31, 1995.
During the four-year award cycle, participants had the opportunity to earn 25%
of their awards in each year of the cycle. In the first cycle year (1992), 25%
was earned. In the second year (1993), 18.75% was earned. In the third year
(1994), 25% was earned, and in the fourth and final year (1995), 6.25% was
earned. Thus, over the four years, 75% of the potential performance award was
earned and paid at the end of the cycle. During this period, the Company's share
price increased 51.5%, from $45.1875 to $68.4375.
Since 75% of the performance award was earned, 75% of the tandem options
were cancelled. The balance of 25% of the stock options granted remain in effect
with an exercise price equal to 100% of the fair market value of the Company's
common stock at the date of the award in 1992. This provides continuing
incentive to increase share price and, therefore, return to the stockholder.
Without share price increase, these options have no value to the executive.
In 1995, Mr. Shoemate received an award of 45,000 performance units which
may be earned over a four-year cycle ending in 1998, and a tandem award of
45,000 stock options. The Committee's decision to grant this award was based
upon its assessment of the long-term compensation survey data, and independent
consultants' evaluations thereof, referred to above, and the evaluation of Mr.
Shoemate's performance for 1994 conducted by all the outside directors, using
the process and performance criteria described on pages 3 and 4. The award was
designed to provide further incentive for Mr. Shoemate to lead the Company in
maximizing stockholder value.
OVERALL PROGRAM RISK AND LEVERAGE
As the compensation tables in this proxy statement indicate, a significant
portion of executive compensation has been placed at risk. Payments under the
annual bonus program are dependent upon annual business results and individual
performance. Long-term award payments are dependent upon the Company's
stockholder return relative to the comparator group of companies referred to
earlier. In the case of Mr. Shoemate, 79.8% of his annual and long-term
compensation came from variable compensation plans which relate to Company
performance and only 20.2% from base salary. Similar degrees of risk exist for
the four other highest paid executive officers.
11
<PAGE>
<PAGE>
EXECUTIVE STOCK OWNERSHIP TARGETS
In 1993, the Company established stock ownership targets for all
participants in the Stock and Performance Plan. The ownership target for the
chief executive officer is seven times base salary; for the most senior
operating and corporate staff officers it is five times base salary; for
remaining officers, it is three times base salary; and for non-officer
participants, it is equal to base salary. Stock used to assess this ownership
target includes stock directly owned by the executive, and stock owned
indirectly through participation in the Deferred Stock Unit Plan described in
footnote 3 to the Stock Ownership Table on page 17, but excludes shares covered
by unexercised stock options. Executives are expected to attain these ownership
targets within three to five years, although executives who have been in their
positions for a considerable period or who have been participants in the Stock
and Performance Plan for some time are expected to achieve target ownership
levels sooner. Four executive officers named in the Summary Compensation Table,
including Mr. Shoemate, exceed their targets.
DEDUCTIBILITY CAP ON COMPENSATION EXCEEDING $1,000,000
The Committee continues to review the effect on the Company of the 1993 tax
law changes and related Internal Revenue Service regulations regarding the
limitation on deductibility of annual compensation payments in excess of $1
million to each of the five highest paid executive officers. It is the
Committee's policy to eliminate or limit, to the extent deemed prudent, the use
of compensation programs under which payments would not be deductible under
these rules. The Committee's conclusion is that the new rules will have no
impact on the Company for 1995, and it is anticipated that there will be little
or no impact for 1996. This is because a substantial portion of compensation
paid or to be paid in these years to the five highest paid executive officers is
excluded in determining whether the $1 million cap is exceeded, either because
it meets objective performance standards, or because of deferral of bonus awards
or, for 1995, because of 'grandfather' provisions in these rules.
Compensation and Nominating
Committee:
T. H. Black, Chairman
A. C. DeCrane, Jr.
W. C. Ferguson
R. G. Holder
W. S. Norman
12
<PAGE>
<PAGE>
EXECUTIVE COMPENSATION AND STOCK OWNERSHIP TABLES
The following table summarizes the compensation awarded or paid to the
chief executive officer and each of the other four most highly compensated
executive officers of the Company (the 'named executive officers') for services
rendered in all capacities during each of the last three fiscal years.
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------
SUMMARY COMPENSATION TABLE
- ----------------------------------------------------------------------------------------------------------------
LONG-TERM COMPENSATION
-----------------------
PAYOUTS
AWARDS ---------
ANNUAL COMPENSATION ---------- LONG-TERM
-------------------------- SECURITIES INCENTIVE ALL OTHER
NAME AND SALARY BONUS UNDERLYING PAYOUTS COMPENSATION
PRINCIPAL POSITION YEAR ($) ($) OPTIONS(#) ($)(1) ($)(2)
- ---------------------------------------- ---- ------- ------- ---------- --------- ------------
<S> <C> <C> <C> <C> <C> <C>
C. R. Shoemate, 1995 766,250 600,000 45,000 2,432,859 112,001
Chairman, President and Chief 1994 716,667 485,000 40,000 1,304,188 109,638
Executive Officer 1993 670,833 455,000 36,000 696,094 45,146
R. J. Gillespie, 1995 497,917 270,000 20,000 1,216,430 75,022
Executive Vice President -- Strategic 1994 453,750 215,000 20,000 698,645 71,564
Planning and Business Development 1993 432,083 215,000 18,000 502,734 27,373
A. Labergere, 1995 413,333 275,000 20,000 1,073,320 24,700
Executive Vice President and President 1994 362,500 220,000 20,000 465,781 21,700
of the CPC Europe Division 1993 337,500 190,000 18,000 212,672 15,500
C. B. Storms, 1995 380,000 215,000 13,500 965,988 28,100
Senior Vice President and General 1994 359,583 170,000 13,500 605,489 23,840
Counsel 1993 341,667 165,000 13,500 483,375 21,843
K. Schlatter, 1995 370,000 205,000 28,874 787,102 106,679
Senior Vice President and Chief 1994 342,500 160,000 13,500 465,781 105,319
Financial Officer 1993 302,500 150,000 12,000 348,047 19,404
</TABLE>
- ------------
(1) Includes cash and the market value of the Company's common stock paid in
respect of performance units awarded under the 1984 Stock and Performance
Plan at the end of four-year performance cycles.
(2) Includes the following for 1995:
a. Company matching contributions to defined contribution plans as follows:
C. R. Shoemate, $51,275; R. J. Gillespie, $35,175; A. Labergere, $24,700;
C. B. Storms, $28,100; and K. Schlatter, $27,500.
b. Value of premiums paid by the Company under the Executive Life Insurance
Plan as follows: C. R. Shoemate, $55,031; R. J. Gillespie, $39,847; and
K. Schlatter, $79,179.
c. For C. R. Shoemate, $5,695 of above-market interest at the rate credited
to all participants in the Deferred Compensation Plan, pursuant to which
all or a portion of annual bonus may be deferred and credited to an
interest bearing account, and paid over a fifteen-year period following
retirement.
13
<PAGE>
<PAGE>
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------------
OPTION GRANTS IN 1995
- ----------------------------------------------------------------------------------------------------------------------
POTENTIAL REALIZABLE
VALUE AT ASSUMED
ANNUAL RATES OF
STOCK PRICE APPRECIATION
INDIVIDUAL GRANTS FOR OPTION TERM(3)
- ------------------------------------------------------------------------------------ --------------------------------
NUMBER OF PERCENT OF
SECURITIES TOTAL OPTIONS
UNDERLYING GRANTED TO EXERCISE
OPTIONS EMPLOYEES PRICE EXPIRATION
NAME GRANTED(#) IN 1995 ($/SHARE) DATE 0% ($) 5% ($) 10% ($)
- ------------------------- ---------- ------------- --------- ---------- ------ --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
C. R. Shoemate........... 45,000(1) 5.6207 53.7500 1/16/05 0 1,521,139 3,854,865
R. J. Gillespie.......... 20,000(1) 2.498 53.7500 1/16/05 0 676,062 1,713,273
A. Labergere............. 20,000(1) 2.498 53.7500 1/16/05 0 676,062 1,713,273
C. B. Storms............. 13,500(1) 1.6862 53.7500 1/16/05 0 456,342 1,156,459
K. Schlatter............. 13,500(1) 1.6862 53.7500 1/16/05 0 456,342 1,156,459
3,718(2) 0.4643 70.9375 3/14/98 0 30,357 62,549
3,719(2) 0.4645 70.9375 3/20/99 0 45,322 95,767
3,375(2) 0.4215 70.9375 3/19/00 0 55,157 119,541
3,125(2) 0.3903 70.9375 3/18/01 0 64,632 143,732
687(2) 0.0858 70.9375 3/16/02 0 17,338 39,585
750(2) 0.0936 70.9375 1/18/03 0 21,960 51,290
</TABLE>
- ------------
(1) The options listed were granted at an exercise price equal to the fair
market value of the Company's stock on the date of grant in tandem with an
equivalent number of performance units under the 1993 Stock and Performance
Plan. The performance units were issued for a cycle of four years' duration,
with a goal based on improvement in stockholder value, determined by the
increase in the value of common stock of the Company during each year of the
cycle assuming reinvestment of dividends, measured against the performance
of the Peer Group described on page 8. Up to 25% of the units may be earned
in each year of the cycle and are payable at the conclusion of the cycle. To
the extent performance units are earned and payable, a corresponding number
of options are cancelled. To the extent options are exercised, a
corresponding number of performance units are cancelled. These options were
granted on January 17, 1995 and became exercisable on January 17, 1996.
Under the 1993 Plan, in the event of a change in control of the Company, all
performance cycles will terminate and participants will receive the value in
cash of the performance units theretofore earned and 100% of the units that
could have been earned during the remainder of the cycles. The amounts paid
to the named executive officers for the cycles ending in 1995, 1994 and 1993
are shown as 'Long-term Incentive Payouts' in the Summary Compensation Table
on page 13.
(2) The options listed are replacement options which were granted upon exercise
of previously granted options. They are equivalent to the number of shares
exercised and have an exercise price equal to the fair market value of the
Company's stock on the date of exercise of the original option. The
expiration date of the replacement option is the same as the expiration date
of the original option. The replacement option becomes exercisable one year
from the date the original option was exercised and is conditioned on the
retention of ownership of the shares acquired on exercise of the original
option for three years.
(3) The amounts shown under these columns are calculated at 0% and at the 5% and
10% rates set by the Securities and Exchange Commission and are not intended
to forecast future appreciation of the Company's stock price. The amounts
shown assume that no performance units will be earned so that all options
granted will be exercisable.
14
<PAGE>
<PAGE>
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------------------
AGGREGATED OPTION EXERCISES IN 1995
AND OPTION VALUES AS OF DECEMBER 31, 1995
- --------------------------------------------------------------------------------------------------------------------------
NUMBER OF VALUE OF
SECURITIES UNDERLYING UNEXERCISED
UNEXERCISED IN-THE-MONEY
OPTIONS AT OPTIONS AT
SHARES DECEMBER 31, 1995 (#) DECEMBER 31, 1995 ($)(2)
ACQUIRED --------------------- ------------------------
ON VALUE EXERCISABLE/ EXERCISABLE/
NAME EXERCISE (#) REALIZED ($)(1) UNEXERCISABLE UNEXERCISABLE
- ----------------------------------- ------------ --------------- ------------- -------------
<S> <C> <C> <C> <C>
C. R. Shoemate..................... -- -- 98,313 / 88,375 2,632,006 / 1,580,402
R. J. Gillespie.................... 4,000 162,000 30,437 / 41,687 1,066,611 / 753,001
A. Labergere....................... 4,062 107,108 7,313 / 41,562 161,151 / 749,802
C. B. Storms....................... -- -- 26,001 / 28,686 899,747 / 519,848
K. Schlatter....................... 15,374 605,982 4,313 / 43,436 97,378 / 506,583
</TABLE>
- ------------
(1) Amounts shown are based on the difference between the market value of the
Company's stock on the date of exercise and the exercise price.
(2) Amounts shown are based on the difference between the closing price of the
Company's common stock on December 29, 1995 ($68.625) and the exercise
price.
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------
PENSION PLAN TABLE
- -----------------------------------------------------------------------------------------------------------
5-YEAR AVERAGE YEARS OF SERVICE
ANNUAL --------------------------------------------------------
COMPENSATION 10 15 20 25 30
- ------------------------------------------------ -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
$ 400,000...................................... $ 48,000 $ 72,000 $ 96,000 $120,000 $144,000
600,000...................................... 72,000 108,000 144,000 180,000 216,000
800,000...................................... 96,000 144,000 192,000 240,000 288,000
1,000,000...................................... 120,000 180,000 240,000 300,000 360,000
1,200,000...................................... 144,000 216,000 288,000 360,000 432,000
1,400,000...................................... 168,000 252,000 336,000 420,000 504,000
1,600,000...................................... 192,000 288,000 384,000 480,000 576,000
1,800,000...................................... 216,000 324,000 432,000 540,000 648,000
</TABLE>
The table shows annual pension benefits payable under the Company's defined
benefit plans for salaried employees. No additional benefits accrue after 30
years of service.
Compensation covered by the plans is the combined annual compensation
reported in the Salary and Bonus columns of the Summary Compensation Table on
page 13. Each of the named executive officers has 30 years of service for
purposes of the plans, except A. Labergere, who has 12. Amounts shown in the
Table are computed as a straight life annuity upon retirement at age 62 or later
and are not subject to any deduction for Social Security benefits.
15
<PAGE>
<PAGE>
EMPLOYMENT AGREEMENTS AND SPECIAL SEVERANCE PROGRAM
The Company has entered into employment agreements with certain of its
executive officers and other key executives. In addition to setting forth
general terms and conditions of employment, the agreements provide for the
continuation of full salary, and continued participation in the Company's
executive compensation and employee benefit plans and programs, in the event of
termination of employment by the Company other than for cause, or by the
individual due to breach of the agreement by the Company. The periods for the
continuation of salary and participation in such plans and programs for the
named executive officers who have such agreements are as follows: C. R.
Shoemate, 3 years; R. J. Gillespie, 2 years; C. B. Storms, 18 months; and K.
Schlatter, 18 months.
The Company maintains a Special Severance Program, applicable to full-time
U.S. salaried employees who do not have employment agreements, which provides
for continuation of salary and employee benefit programs for periods ranging
from three months to one year, depending primarily on length of service, in the
event of termination of employment within two years following a change in
control of the Company.
- --------------------------------------------------------------------------------
STOCK OWNERSHIP TABLE
- --------------------------------------------------------------------------------
Fidelity Management Trust Company of Boston, Massachusetts, as trustee of
the ESOP component of the Savings Plan, is the record owner of all of the
1,421,276 unallocated shares of ESOP preferred stock, or 66.6 percent of the
outstanding preferred stock of the Company. To the best of the Company's
knowledge, no person or group of persons owned beneficially more than five
percent of the outstanding common stock of the Company on February 29, 1996, the
record date.
16
<PAGE>
<PAGE>
The following table sets forth the common stock ownership as of February
29, 1996 of each director, the named executive officers, and all directors and
executive officers as a group. All directors and executive officers as a group
own beneficially less than one percent of the outstanding common stock and less
than two percent of the ESOP preferred stock.
<TABLE>
<CAPTION>
SHARES STOCK
NAME OWNED(1) OTHER(2) UNITS(3) TOTAL(4)
- --------------------------------------------------------------- -------- ------- ------ ---------
<S> <C> <C> <C> <C>
T. H. Black.................................................... 5,000 -- 1,641 6,641
A. C. DeCrane, Jr.............................................. 500 -- 1,347 1,847
W. C. Ferguson................................................. -- 2,800 2,115 4,915
R. J. Gillespie................................................ 40,445 66,153 -- 106,598
E. R. Gordon................................................... 2,000 -- 5,363 7,363
G. V. Grune.................................................... 2,200 -- 2,580 4,780
L. I. Higdon, Jr............................................... 200 -- 431 631
R. G. Holder................................................... 1,000 1,000 2,707 4,707
E. S. Kraus.................................................... 200 -- 1,297 1,497
A. Labergere................................................... 27,460 -- -- 27,460
W. S. Norman................................................... 1,000 -- 431 1,431
K. Schlatter................................................... 7,350 62,143 3,065 72,558
C. R. Shoemate................................................. 106,723 12,076 6,915 125,714
C. B. Storms................................................... 50,470 9,987 3,344 63,801
All directors and executive officers as a group
(34 persons)................................................ 789,328 191,656 57,037 1,038,021
</TABLE>
- ------------
(1) Includes all shares which may be purchased before April 30, 1996 upon the
exercise of stock options as follows: R. J. Gillespie, 32,437; A. Labergere,
11,813; K. Schlatter, 7,350; and all directors and executive officers as a
group, 218,167.
(2) Includes shares held jointly with or owned by spouses or minor children or
held in certain fiduciary capacities. K. Schlatter, C. R. Shoemate, and all
directors and executive officers as a group disclaim beneficial ownership
of, respectively, 17,900, 12,076, and 38,026 of such shares.
(3) For the executive officers, the stock units represent annual bonus deferred
and credited in the form of common stock under the Deferred Stock Unit Plan.
Amounts so deferred are payable only in cash following retirement or
termination of employment. For the outside directors, the stock units
represent retainer and fees deferred in the form of common stock under the
Deferred Compensation Plan for Outside Directors described on page 7.
(4) In addition, Messrs. Gillespie, Schlatter, Shoemate and Storms have,
respectively, 1,841, 1,821, 1,818 and 2,131 shares, and all executive
officers as a group have a total of 36,816 shares, of ESOP preferred stock
allocated to their accounts in the Savings Plan.
17
<PAGE>
<PAGE>
MATTERS TO BE ACTED UPON
Proposal 1. Election of Directors
The Board of Directors is divided into three classes, with one class
standing for election each year for a three-year term. In accordance with the
recommendation of its Compensation and Nominating Committee, the Board has
nominated Theodore H. Black, Richard G. Holder, Eileen S. Kraus and Alain
Labergere for reelection, each for a three-year term that will expire in 1999.
All of the nominees for election have consented to being named in this
proxy statement and to serve if elected. If, for any reason, any of the nominees
should not be a candidate for election at the meeting, the proxies will be cast
for substitute nominees designated by the Board of Directors unless the Board
has reduced its membership prior to the meeting. The Board does not anticipate
that any of the nominees will be unavailable. The nominees and the directors
continuing in office will normally hold office until the annual meeting of
stockholders in the year indicated on this and the following pages.
Biographical information concerning each of the nominees and directors
continuing in office is presented on this and the following pages.
VOTE REQUIRED
A plurality of the votes of the shares present in person or represented by
proxy at the annual meeting is required to elect directors.
- --------------------------------------------------------------------------------
CLASS I NOMINEES FOR THREE-YEAR TERMS EXPIRING IN 1999
- --------------------------------------------------------------------------------
[Photo]
THEODORE H. BLACK
Age -- 67
Director since 1989
Chairman of the Compensation and Nominating Committee and
member of the Corporate Affairs Committee
FORMER CHAIRMAN AND CHIEF EXECUTIVE OFFICER OF INGERSOLL-RAND
COMPANY
Mr. Black served as President and Chief Operating Officer of
Ingersoll-Rand Company during 1988, and as Chairman and Chief
Executive Officer until November 1993. He is a director of
General Public Utilities Corporation, McDermott International,
Inc. and Ingersoll-Rand Company.
18
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
[Photo]
RICHARD G. HOLDER
Age -- 64
Director since 1992
Chairman of the Corporate Affairs Committee and member of the
Compensation and Nominating Committee
CHAIRMAN AND CHIEF EXECUTIVE OFFICER OF REYNOLDS METALS
COMPANY
Mr. Holder served as President and Chief Operating Officer of
Reynolds Metals Company from 1988 until May 1992, when he
assumed his present position. Previously, he served as
Executive Vice President and Chief Operating Officer from
1986. Mr. Holder is also a director of Universal Corp., a
trustee of the Virginia Foundation for Independent Colleges,
and a member of the Board of Directors of the Virginia
Economic Development Partnership, the National Association of
Manufacturers and the American Red Cross Corporate Advisory
Committee. Mr. Holder served as chairman of the Aluminum
Association from September 1991 through December 1993.
- --------------------------------------------------------------------------------
[Photo]
EILEEN S. KRAUS
Age -- 57
Director since 1994
Member of the Audit and Corporate Affairs Committees
CHAIRMAN OF FLEET BANK, N.A.
Ms. Kraus served as Vice Chairman of Shawmut National
Corporation and President of Shawmut Bank Connecticut, N.A.
from September 1992 until December 1995. She assumed her
present position following Fleet Financial Group's completion
of its acquisition of Shawmut National Corporation on December
1, 1995. She served as Vice Chairman of the Consumer Banking
and Marketing Groups, Shawmut National Corporation, from 1990
until September 1992 and Executive Vice President of such
Groups from 1988 until July 1990. She is a director of Fleet
Bank, Kaman Corporation, The Stanley Works, and Yankee Energy
System, Inc. Ms. Kraus is also a member of the Board of
Trustees and the executive committee of Trinity College,
Kingswood-Oxford School, Horace Bushnell Memorial Hall, and
Connecticut Business and Industry Association.
19
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
[Photo]
ALAIN LABERGERE
Age -- 61
Director since 1992
Member of the Corporate Affairs Committee
EXECUTIVE VICE PRESIDENT OF THE COMPANY AND PRESIDENT OF THE
CPC EUROPE DIVISION
Mr. Labergere joined the Company in 1983 and in 1990 was
appointed Vice President, Regional Operations, for the CPC
Europe Consumer Foods Division headquartered in Brussels. In
1991 he was appointed President of the CPC Europe Division and
elected a corporate Vice President. He was elected a Senior
Vice President of the Company in October 1991 and an Executive
Vice President on July 1, 1995. Mr. Labergere is a member of
the Strategic Committee of the Confederation of the Food and
Drink Industries of the EEC (CIAA) in Brussels.
- --------------------------------------------------------------------------------
CLASS II DIRECTORS CONTINUING IN OFFICE UNTIL 1997
- --------------------------------------------------------------------------------
[Photo]
WILLIAM C. FERGUSON
Age -- 65
Director since 1988
Member of the Compensation and Nominating and Corporate
Affairs Committees
FORMER CHAIRMAN AND CHIEF EXECUTIVE OFFICER OF NYNEX
CORPORATION
Mr. Ferguson retired as Chairman of NYNEX in April 1995 and as
Chief Executive Officer in December 1994. He served as Vice
Chairman from 1987 to 1989. Previously, Mr. Ferguson served as
President and Chief Executive Officer of NYNEX and New York
Telephone Co. He is also a director of General Re Corporation.
Mr. Ferguson is a director and former Chairman of The Business
Council of New York, Chairman of the Board of United Ways of
Tri-State and Chairman of the Board of Trustees of Albion
College.
20
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
[Photo]
LEO I. HIGDON, JR.
Age -- 49
Director since 1993
Member of the Audit and Corporate Affairs Committees
DEAN OF COLGATE DARDEN GRADUATE SCHOOL OF BUSINESS
ADMINISTRATION AT THE UNIVERSITY OF VIRGINIA
Mr. Higdon has headed the Darden School, located in
Charlottesville, Virginia, since October 1993. He joined the
University of Virginia from Salomon Brothers Inc., where he
was a member of the Executive Committee. During his 20-year
career at Salomon Brothers, Mr. Higdon served as a managing
director with responsibilities for corporate finance and
mergers and acquisitions, as the firm's vice chairman, and as
its co-head of global investment banking. He is also a
director of Crompton & Knowles Corp., Newmont Mining Corp.,
Newmont Gold Co. and Africare, and is a trustee and member of
the Executive Committee of Georgetown University.
- --------------------------------------------------------------------------------
[Photo]
WILLIAM S. NORMAN
Age -- 57
Director since 1993
Member of the Compensation and Nominating and Finance
Committees
PRESIDENT AND CHIEF EXECUTIVE OFFICER OF THE TRAVEL INDUSTRY
ASSOCIATION OF AMERICA
Mr. Norman joined the Travel Industry Association of America
as President and Chief Executive Officer in the Fall of 1994.
Previously, he served as Executive Vice President of the
National Railroad Passenger Corp. (AMTRAK) since 1987. He is a
director of the Travel Industry Association of America, the
United Nations Association of the United States of America,
the U.S. Navy Memorial Foundation and the Logistics Management
Institute. He is also a member of the Board of Visitors of The
American University's Kogod College of Business
Administration.
21
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
[Photo]
CHARLES R. SHOEMATE
Age -- 56
Director since 1988
CHAIRMAN OF THE BOARD, PRESIDENT AND CHIEF EXECUTIVE OFFICER
OF THE COMPANY
Mr. Shoemate was elected Chairman of the Board and Chief
Executive Officer in 1990. Prior to his election as President
in 1988, Mr. Shoemate served as Vice President of the Company
and President of the Corn Refining Division. Mr. Shoemate
joined the Company in 1962 and progressed through a variety of
positions in manufacturing, finance and business management.
He is also a director of CIGNA Corporation, International
Paper Co., and the Grocery Manufacturers of America, Inc. He
is a member of The Business Roundtable, the Committee for
Economic Development, and a trustee of The Conference Board,
Inc.
- --------------------------------------------------------------------------------
CLASS III DIRECTORS CONTINUING IN OFFICE UNTIL 1998
- --------------------------------------------------------------------------------
[Photo]
ALFRED C. DECRANE, JR.
Age -- 64
Director since 1994
Member of the Compensation and Nominating and Finance
Committees
CHAIRMAN AND CHIEF EXECUTIVE OFFICER OF TEXACO INC.
Mr. DeCrane was elected President of Texaco Inc. in 1983,
Chairman of the Board in 1987, and Chief Executive Officer in
1993. He is a director of Texaco Inc., CIGNA Corporation, and
Dean Witter, Discover & Co. He is a trustee of the Committee
for Economic Development and The Conference Board, Inc., a
director of the American Petroleum Institute, and a member of
the National Petroleum Council and The Business Roundtable. He
is also a member of the Board of Trustees of the University of
Notre Dame and a Managing Director of the Metropolitan Opera
Association.
22
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
[Photo]
ROBERT J. GILLESPIE
Age -- 53
Director since 1988
Member of the Finance Committee
EXECUTIVE VICE PRESIDENT OF THE COMPANY
Mr. Gillespie was elected an Executive Vice President of the
Company in July 1995. He joined the Company in 1965 and in
1976 became President of Canada Starch Company, a subsidiary
of the Company. In 1980 he was elected a Vice President of the
Company and appointed President of the Corn Products Unit of
CPC North America. From 1988 to July 1995, he served as
President of the Best Foods Division and was elected a Senior
Vice President of the Company in 1991. Mr. Gillespie is a
member of the Advisory Board of the Sarah W. Stedman Center
for Nutritional Studies of Duke University.
- --------------------------------------------------------------------------------
[Photo]
ELLEN R. GORDON
Age -- 64
Director since 1991
Chairman of the Audit Committee and member of the Finance
Committee
PRESIDENT AND CHIEF OPERATING OFFICER OF TOOTSIE ROLL
INDUSTRIES, INC.
Ms. Gordon was elected President and Chief Operating Officer
of Tootsie Roll Industries, Inc. in 1978. Prior to her
election as President, Ms. Gordon served as Senior Vice
President. Ms. Gordon is a member of the Advisory Council of
the Stanford University Graduate School of Business, the Board
of Fellows of the Faculty of Medicine of the Harvard Medical
School, the Advisory Council of the J. L. Kellogg Graduate
School of Management of Northwestern University, the
University of Chicago Council on the Division of the
Biological Sciences and the Pritzker School of Medicine, the
President's Export Council, the Committee of 200, the
Committee for Economic Development, and a director of the
National Confectioners Association.
23
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
[Photo]
GEORGE V. GRUNE
Age -- 66
Director since 1985
Chairman of the Finance Committee and member of the Audit
Committee
FORMER CHAIRMAN AND CHIEF EXECUTIVE OFFICER OF THE READER'S
DIGEST ASSOCIATION, INC.
Mr. Grune retired as Chairman of The Reader's Digest
Association, Inc. in August 1995 and as Chief Executive
Officer in 1994, having served as Chairman and Chief Executive
Officer for ten years. He is presently chairman of the DeWitt
Wallace -- Reader's Digest Fund, Lila Wallace -- Reader's
Digest Fund. He is also a director of Avon Products, Inc.,
Chemical Banking Corporation and Federated Department Stores,
Inc. He is chairman of the Boys & Girls Clubs of America, a
trustee of Duke University and an overseer of Roy E. Crummer
Graduate School of Business at Rollins College.
- --------------------------------------------------------------------------------
Proposal 2. Appointment of Auditors
The Board of Directors, in accordance with the recommendation of its Audit
Committee, has appointed KPMG Peat Marwick LLP as independent auditors in
respect of the Company's operations in 1996, subject to ratification by the
stockholders. A partner of KPMG Peat Marwick LLP will be present at the
stockholders' meeting and will have an opportunity to make a statement and
respond to appropriate questions.
In addition to audit services, KPMG Peat Marwick LLP has rendered non-audit
services to the Company. The non-audit services are reviewed by the Audit
Committee to assure that performance thereof does not affect the firm's
independence.
THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE FOR THIS PROPOSAL.
OTHER BUSINESS
The Board of Directors knows of no other matters to be brought before the
meeting. However, if other proposals are properly presented, the persons named
in the accompanying proxy will vote upon them in accordance with their best
judgment.
24
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<PAGE>
PROPOSALS FOR THE 1997 ANNUAL MEETING
It is anticipated that the 1997 annual meeting of stockholders will be held
on Thursday, April 24, 1997. Stockholder proposals for inclusion in the
Company's proxy statement for that meeting must be received by the Secretary of
the Company no later than November 12, 1996. Additionally, under the Company's
By-laws, any other business, including the nomination of candidates for
director, may be presented at the meeting by a stockholder only if a written
notice identifying such business or candidates is received by the Secretary of
the Company not earlier than January 24 nor later than February 21, 1997. A copy
of the By-laws will be furnished to any stockholder without charge upon written
request to the Secretary.
ADDITIONAL INFORMATION
If you plan to attend the annual meeting, please complete the reservation
form on the inside back cover and return it either with your proxy card or
directly to the Company at the address indicated on the reservation form.
A summary of the meeting will be included in the midyear report which will
be mailed to stockholders on or about July 25, 1996.
The rules of the Securities and Exchange Commission require that an annual
report accompany or precede the proxy materials. However, no more than one
annual report need be sent to the same address. If more than one annual report
is being sent to your address and you wish to reduce the number of annual
reports you receive, please mark the Discontinue Annual Report Mailing box in
the Special Action area on the proxy card.
PLEASE COMPLETE THE ENCLOSED PROXY CARD AND MAIL IT IN THE ENCLOSED
POSTAGE-PAID ENVELOPE AS SOON AS POSSIBLE.
By order of the Board of Directors,
/s/ John B. Meagher
John B. Meagher
Secretary
25
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<PAGE>
RESERVATION FORM FOR ANNUAL MEETING
If you plan to attend the CPC International Inc. annual meeting of
stockholders to be held at Tamcrest Country Club, Route 9W, Montammy Drive,
Alpine, New Jersey, at 9:30 A.M. on Thursday, April 25, 1996, this form may be
used to request an admission ticket. The envelope provided for the return of
your proxy card may be used to return this form or you may mail it directly to
C. B. Magarro, Assistant Secretary, International Plaza, P.O. Box 8000,
Englewood Cliffs, New Jersey 07632-9976.
I plan to attend the meeting. Please send me an admission ticket for the
number of persons indicated below.
Name ___________________________________________________________________________
Address ________________________________________________________________________
City, State ________________________________________ Zip Code __________________
Number of persons attending ____________________________________________________
26
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<PAGE>
APPENDIX A - PROXY CARD
CPC INTERNATIONAL INC.
Proxy Solicited on Behalf of the Board of Directors of
the Company for Annual Meeting on April 25, 1996
<TABLE>
<S> <C>
P
R The undersigned hereby appoints CHARLES R. SHOEMATE, CLIFFORD B. STORMS and JOHN B. MEAGHER, as Proxies,
each with the power to appoint his substitute, and hereby authorizes each of them to represent and to
O vote, as designated on the reverse side hereof, all of the shares of common and ESOP preferred stock of
CPC International Inc. which the undersigned is entitled to vote at the annual meeting of stockholders
X to be held at Tamcrest County Club, Route 9W, Montammy Drive, Alpine, New Jersey on April 25, 1996 at
9:30 A.M., local time, or any adjournment thereof, and in their discretion, upon any other matters which
Y may properly come before the meeting.
(Change of Address/Comments)
Election of four Directors, each for a term of three years.
-----------------------------------------------------
Nominees:
Theodore H. Black -----------------------------------------------------
Richard G. Holder
Eileen S. Kraus -----------------------------------------------------
Alain Labergere
-----------------------------------------------------
(If you have written in the above space, please mark
the corresponding box on the reverse side of this card)
SEE REVERSE
[RECYCLED LOGO] Printed on recycled paper SIDE
</TABLE>
<PAGE>
<PAGE>
[ X ] Please mark your 6654
votes as in this
example
This proxy when properly executed will be voted in the manner directed herein by
the undersigned stockholder. If no direction is made, this proxy will be voted
FOR proposals 1 and 2. The ESOP Trustee shall vote unallocated ESOP preferred
stock as directed on this proxy by the participant.
<TABLE>
<S> <C> <C>
- -----------------------------------------------------------------------------------------------------------------------------------
The Board of Directors recommends a vote FOR Proposals 1 and 2 Special Action
- -----------------------------------------------------------------------------------------------------------------------------------
FOR WITHHELD FOR AGAINST ABSTAIN
1. Election of 2. Appointment of Discontinue Annual Report [ ]
Directors [ ] [ ] KPMG Peat Marwick [ ] [ ] [ ] Mailing for this Account
(see reverse) LLP as Independent ------------------------------------
Auditors Change of
Address on [ ]
For, except vote WITHHELD from the following nominee(s): Reverse Side
- -------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
Please date, sign exactly as name
appears hereon and return promptly
in the enclosed envelope. When shares
are held by joint tenants, both should
sign. When signing as attorney,
executor, administrator, trustee or
guardian, please give full title as
such. If a corporation, please sign
in full corporate name by president or
other authorized officer. If a
partnership, please sign in partnership
name by authorized person.
---------------------------------------
---------------------------------------
SIGNATURE(S) DATE
</TABLE>
