SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
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 Rule 14a-11(c) or Rule 14a-12
CROWN CORK & SEAL COMPANY, INC.
(Name of Registrant as Specified in Its Charter)
CROWN CORK & SEAL COMPANY, INC.
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
[X] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(i)(2) or
Item 22(a)(2) of Schedule 14A.
[ ] $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1) Title of each class of securities to which transaction applies:
2) Aggregate number of securities to which transaction applies:
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
4) Proposed maximum aggregate value of transaction:
5) Total fee paid:
[ ] Fee paid previously with preliminary materials:
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
2) Form, Schedule or Registration Statement No.:
3) Filing Party:
4) Date Filed:
<PAGE>
Crown Cork & Seal Company, Inc.
9300 Ashton Road
Philadelphia, Pennsylvania 19136
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
OF COMMON AND PREFERRED STOCK
1996
NOTICE IS HEREBY GIVEN that the Annual Meeting of Shareholders of Common
Stock and 4-1/2% Convertible Preferred Stock ("Preferred Stock") of CROWN CORK &
SEAL COMPANY, INC. ("Company") will be held at the Company's Office located at
9300 Ashton Road, Philadelphia, Pennsylvania, on the 25th day of April 1996 at
11:00 A.M., to elect Directors and to transact such other business that may
properly come before the meeting.
The stock transfer books of the Company will not be closed prior to the
Meeting. Only Shareholders of Common Stock and Preferred Stock of record as of
the close of business on March 15, 1996 will be entitled to vote.
By Order of the Board of Directors
RICHARD L. KRZYZANOWSKI
Executive Vice President, Secretary &
General Counsel
Philadelphia, Pennsylvania 19136
March 22, 1996
WE CORDIALLY INVITE YOU AND HOPE THAT YOU WILL ATTEND THE
MEETING IN PERSON, BUT, IF YOU ARE UNABLE TO ATTEND,
THE BOARD OF DIRECTORS REQUESTS THAT YOU SIGN THE PROXY
AND RETURN IT, WITHOUT DELAY, IN THE ENCLOSED ENVELOPE.
1
<PAGE>
Crown Cork & Seal Company, Inc.
9300 Ashton Road
Philadelphia, Pennsylvania 19136
PROXY STATEMENT -- MEETING, April 25, 1996
To All Shareholders:
The accompanying Proxy is solicited by the Board of Directors of the
Company for use at the Annual Meeting of Shareholders to be held on April 25,
1996 and, if properly executed, shares represented thereby will be voted by the
named proxies or attorneys at such meeting. The cost of soliciting proxies will
be borne by the Company. The Company has engaged D.F. King & Co., Inc. ("King")
to assist in the solicitation of proxies for a fee of $6,000 plus reimbursement
for out-of-pocket expenses and certain additional fees for services rendered by
King in connection with such solicitation. Certain officers and employees of the
Company may also solicit proxies by mail, telephone, facsimile or in person
without any extra compensation. Any Shareholder giving a Proxy has the power to
revoke it at any time before it is voted by giving written notice of revocation
to the Secretary of the Company, or by executing and delivering a later-dated
Proxy, or by voting in person at the meeting.
The persons named as Proxies were selected by the Board of Directors of the
Company, and all are Directors and Officers of the Company.
The Annual Report for the year ended December 31, 1995, containing audited
financial statements, is being mailed to Shareholders contemporaneously with
this Proxy Statement, i.e., on or about March 22, 1996.
On March 1, 1996, there were 128,106,778 outstanding shares of Common
Stock, par value $5.00 per share, ("Common Stock") and 12,432,622 outstanding
shares of 4-1/2 % Convertible Preferred Stock, par value $41.8875 per share
("Preferred Stock").
Shareholders of Common Stock and Preferred Stock of record as of March 15,
1996 (the "Record Date") are entitled to vote at the Annual Meeting. Each share
of Common Stock is entitled to one vote, and each share of Preferred Stock is
entitled to the number of votes equal to the number of shares of Common Stock
into which such share of Preferred Stock is convertible as of the Record Date.
As of the Record Date, each share of Preferred Stock was convertible into Common
Stock at the rate equal to the $41.8875 par value of such Preferred Stock
divided by the applicable conversion price of $45.9715. Accordingly, each share
of Preferred Stock outstanding as of the Record Date will be entitled to
approximately 0.91 votes at the meeting. Assuming that 128,106,778 shares of
Common Stock and 12,432,622 shares of Preferred Stock remain outstanding as of
the Record Date, such shares of Preferred Stock, in the aggregate, will be
entitled to 11,328,137 votes, resulting in a total of 139,434,915 votes entitled
to be cast at the meeting (such total number of votes entitled to be cast being
referred to herein as the "Total Voting Power").
The presence, in person or by proxy, of Shareholders entitled to cast a
majority of votes will be necessary to constitute a quorum for the transaction
of business. Proxies solicited herein will be voted, and if the person solicited
specifies by means of the ballot provided in the Proxy a choice with respect to
matters to be acted upon, the shares will be voted in accordance with such
specification. Votes
2
<PAGE>
withheld from Director nominees, abstentions and broker non-votes will be
counted in determining the presence of a quorum. Under Pennsylvania Law and the
Company's By-Laws, abstentions and broker non-votes are not considered to be
"votes" and, therefore, shall not be given effect either as affirmative or
negative votes. Votes which are withheld shall be excluded entirely from the
vote for election of Directors.
Other than as listed below, the Company has, to the best of its knowledge,
no other beneficial owner of more than 5 percent of the Common Stock or
Preferred Stock outstanding as of March 1, 1996.
Security Ownership of Certain Beneficial Owners
Amount and Percentage of Class of Securities
of the Company
Owned Beneficially, Directly or Indirectly(1)
<TABLE>
<CAPTION>
Total Voting
Power of % of Total
Name and Address Beneficial Voting Power
of Beneficial Owner Common % Preferred % Owner(2) Outstanding
<S> <C> <C> <C> <C> <C> <C>
Compagnie Generale
d'Industrie et de
Participations and certain of
its affiliates(3) 27,809,540(4) 20.66%(5) 7,110,300 57.19% 27,809,540(2) 19.94%
The Connelly Foundation(6) 7,838,150 6.12% 0 0% 7,838,150 5.62%
<FN>
(1) Based on information filed with the Securities and Exchange Commission.
Percentages are derived using the outstanding shares of each class as of
March 1, 1996.
(2) Equivalent to total number of shares of Common Stock which would be held
upon conversion of Preferred Stock into Common Stock.
(3) Compagnie Generale d'Industrie et de Participations ("CGIP") is a French
societe anonyme, located at 89 rue Taitbout, 75009 Paris, France.
Marine-Wendel and SGVM, each a French societe anonyme, and
Wendel-Participations, a French societe en nom collectif, all located at 89
rue Taitbout, 75009 Paris, France, may be deemed to share the voting and
dispositive power of the 27,809,540 shares of Common Stock (including the
6,478,637 shares issuable upon conversion of the Preferred Stock) and the
7,110,300 shares of Preferred Stock by virtue of Marine-Wendel's 51.85%
ownership interest in CGIP, Wendel-Participations' 52.56% ownership
interest in Marine-Wendel, and SGVM's 62.37% ownership interest in
Wendel-Participations.
(4) Includes 6,478,637 shares of Common Stock which would be received upon a
conversion of the 7,110,300 shares of Preferred Stock beneficially owned by
CGIP.
(5) Assumes that the 5,322,322 shares of Preferred Stock outstanding as of
March 1, 1996 and not beneficially owned by CGIP remain unconverted. If
such shares are assumed to be converted into 4,849,499 shares of Common
Stock, CGIP would beneficially own 19.94% of the outstanding Common Stock
as of such date.
(6) The address of The Connelly Foundation is One Tower Bridge, Suite 1450,
West Conshohocken, Pennsylvania 19428.
</FN>
</TABLE>
3
<PAGE>
ELECTION OF DIRECTORS
The persons named in the proxy shall vote the shares for the nominees
listed below, all of whom are now Directors of the Company, to serve as
Directors for the ensuing year or until their successors shall be elected. None
of the persons named as nominees for Directors has indicated that he or she will
be unable or will decline to serve. In the event that any of the nominees are
unable or decline to serve, which the Nominating Committee of the Board of
Directors does not believe will happen, the persons named in the proxy will vote
for the remaining nominees and others who may be selected by the Nominating
Committee.
The By-Laws of the Company provide for a variable number of Directors from
10 to 18. The Board of Directors has currently fixed the number of Directors at
15. It is intended that the proxies will be voted for the election of the 15
nominees named below as Directors, and no more than 15 will be nominated. None
of the nominees, during the last five years, was involved as a defendant in any
legal proceedings that could adversely affect his or her capacity to serve as a
member of the Board of Directors. The principal occupations stated below are the
occupations which the nominees have had during the last five years.
The Board of Directors recommends that Shareholders vote FOR election of
each of the nominees named below. The names of the nominees and information
concerning them and their associations as of March 1, 1996, as furnished by the
nominees, follow:
<TABLE>
<CAPTION>
Amount and Percentage of
Year Securities of the Company Owned
First Beneficially, Directly or Indirectly
Became Common Preferred % of Total
Name Age Principal Occupation Director Shares % Shares % Voting Power(A)
<S> <C> <C> <C> <C> <C> <C> <C>
William J. Avery 55 Chairman of the Board 1979 5,600,697 4.372% 4.017%
(a), (d), (e), (1), (2) and Chief Executive Officer
Henry E. Butwel 67 Former Executive Vice President, 1975 97,400 0.076% 0.070%
(a), (b) Administration and Chief Financial
Officer, Retired
Charles F. Casey 69 Former Chairman of the Board of 1992 4,000 0.003% 0.003%
(b) CONSTAR International Inc., now
a wholly-owned subsidiary of the
Company, Retired
Francis X. Dalton 72 Former Treasurer, Retired 1987 63,941 0.050% 0.046%
Guy de Wouters 65 Director of CGIP; Director of 1996 3,676(8) 0.003% 173 0.001% 0.003%
(b), (e) Marine-Wendel, which is the owner
of a majority of the outstanding
shares of CGIP; also a Director of
Powerfin, Tractebel and Eurotunnel
Chester C. Hilinski 78 Of Counsel, Dechert Price 1984 17,100 0.013% 0.012%
(a), (c), (d) & Rhoads, Attorneys
Richard L. Krzyzanowski 63 Executive Vice President, 1983 138,967 0.108% 0.100%
(a), (3) Secretary and General Counsel
Josephine C. Mandeville 55 President and Chief Executive 1991 301,100 0.235% 0.216%
(4) Officer of The Connelly Foundation,
a non-profit charitable foundation
</TABLE>
4
<PAGE>
<TABLE>
<CAPTION>
Amount and Percentage of
Year Securities of the Company Owned
First Beneficially, Directly or Indirectly
Became Common Preferred % of Total
Name Age Principal Occupation Director Shares % Shares % Voting Power(A)
<S> <C> <C> <C> <C> <C> <C> <C>
Michael J. McKenna 61 President and Chief Operating 1987 136,563 0.107% 0.098%
(a), (5) Officer
Felix G. Rohatyn 67 Managing Director of Lazard 1996 3,000 0.002% 0.002%
(e) Freres & Co. LLC; also a
Director of Pfizer Inc. and
General Instrument Corporation
Alan W. Rutherford 52 Executive Vice President and 1991 5,413,302 4.226% 3.882%
(e), (2), (6) Chief Financial Officer
J. Douglass Scott 75 Former President and Chief 1973 377,876 0.295% 0.271%
(7) Executive Officer of Crown
Cork & Seal Canada Inc., Retired
Ernest-Antoine Seilliere 58 Chairman of CarnaudMetalbox, 1996 8,520(8) 0.007% 1,411 0.011% 0.006%
(a), (c), (d), (e) a subsidiary of the Company;
Chairman and Chief Executive
Officer of CGIP; Chairman and Chief
Executive Officer of Marine-Wendel,
which is the owner of a
majority of the outstanding shares
of CGIP; also a Director of
Peugeot, Cap Gemini Sogeti, Societe
Generale and Valeo
Robert J. Siebert 75 Director and Retired President of 1966 46,170 0.036% 0.033%
CRC Chemicals Inc., a marketer of
chemical specialties; Management
Consultant
Harold A. Sorgenti 61 Managing Partner of The Freedom 1991 1,950 0.002% 0.001%
(b), (c), (e) Group and a Director of CoreStates
Financial Corp.
<FN>
(A) Total Voting Power: Shareholders of Common Stock of record as of the Record
Date are entitled to one vote for each share then held. Each share of
Preferred Stock is entitled to the number of votes equal to the number of
shares of Common Stock into which such share of Preferred Stock is
convertible as of the Record Date. As of the Record Date, each share of
Preferred Stock was convertible into Common Stock at the rate equal to the
$41.8875 par value of such Preferred Stock divided by the applicable
conversion price of $45.9715. Accordingly, each share of Preferred Stock
outstanding as of the Record Date will be entitled to approximately 0.91
votes at the Annual Meeting. Assuming that 128,106,778 shares of Common
Stock and 12,432,622 shares of Preferred Stock remain outstanding as of the
Record Date, such shares of Preferred Stock, in the aggregate, will be
entitled to 11,328,137 votes, resulting in Total Voting Power of
139,434,915 votes entitled to be cast at the meeting.
(a) Member of the Executive Committee (d) Member of the Nominating Committee
(b) Member of the Audit Committee (e) Member of the Strategic Committee
(c) Member of the Executive Compensation
Committee
(1) Includes 18,000 shares of Common Stock owned by a charitable foundation of
which Mr. Avery is one of three trustees, and 92,125 shares of Common Stock
subject to presently exercisable options held by Mr. Avery.
(2) Includes 5,372,215 shares of Common Stock held in the Crown Cork & Seal
Company, Inc. Master Retirement Trust on behalf of various Company pension
plans (the "Trust Shares"). Under the Master Retirement Trust, the Benefits
Plan Investment Committee (the "Investment Committee") has sole voting and
dispositive power with respect to the Trust Shares. As members of the
Investment Committee, Mr. Avery and Mr. Rutherford may be deemed to
beneficially own such Trust Shares.
(3) Includes 3,700 shares of Common Stock owned by a charitable foundation of
which Mr. Krzyzanowski is one of five trustees, and 10,950 shares of Common
Stock subject to presently exercisable options held by Mr. Krzyzanowski,
and 28,700 shares of Common Stock held by a charitable remainder trust of
which Mr. Krzyzanowski is a trustee.
(4) Includes 68,000 shares of Common Stock in the Estate of Owen A. Mandeville,
Jr. of which Mrs. Mandeville is the Executrix. In 1995, the Company
obtained insurance with various insurers through Mandeville Insurance
Associates, Inc., insurance brokers, of which the Estate of Owen A.
Mandeville, Jr. was the majority Shareholder. The premiums paid for this
insurance in 1995 were approximately $3,500,000. In the opinion of the
Management of the Company, the insurance was obtained on terms fair and
reasonable and as favorable to the Company as could have been obtained from
others.
(5) Includes 4,300 shares of Common Stock owned by a charitable foundation of
which Mr. McKenna is one of eight trustees and 23,525 shares of Common
Stock subject to presently exercisable options held by Mr. McKenna.
(6) Includes 23,500 shares of Common Stock subject to presently exercisable
options held by Mr. Rutherford.
(7) Includes 365,876 shares of Common Stock held in the Crown Cork & Seal
Canada Inc. Pension Fund on behalf of various Crown Cork & Seal Canada Inc.
pension plans (the "Fund Shares"). Under the Pension Fund, the Pension
Committee has sole voting and dispositive power with respect to the Fund
Shares. As a member of the Pension Committee, Mr. Scott may be deemed to
beneficially own such Fund Shares.
(8) Includes shares of Common Stock which would be received upon a conversion
of the shares of Preferred Stock beneficially owned by Mr. de Wouters and
Mr. Seilliere respectively.
</FN>
</TABLE>
5
<PAGE>
In addition, as of March 1, 1996, Mark W. Hartman, Executive Vice
President, Office of the Chairman, is beneficial owner of 61,213 shares of
Common Stock(1), and Hans J. Loliger, Executive Vice President and President of
the Plastics Division, is beneficial owner of 27,053 shares of Common Stock(2).
As of March 1, 1996, all Directors and Executive Officers of the Company as
a group of 26 including the above are beneficial owners of 7,148,683 shares of
Common Stock (including 5,738,091 shares of Common Stock which may be deemed to
be beneficially owned by certain Directors and Executive Officers by virtue of
their membership on the Investment Committee of the Company Master Retirement
Trust and the Pension Committee of the Crown Cork & Seal Canada Inc. Pension
Fund and 266,225 shares of Common Stock subject to presently exercisable options
held by such persons), constituting 5.580% of the outstanding Common Stock, and
1,692 shares of Preferred Stock, constituting 0.014% of the outstanding
Preferred Stock. Such shares of Common Stock and Preferred Stock are entitled to
cast 7,148,683 votes at the Annual Meeting, representing 5.127% of the
outstanding Total Voting Power.
The Directors and Executive Officers of the Company, in respect to the
securities of the Company listed in the table above, have sole voting and
investment power, except as to the shares held in the aforementioned trusts
(including the Company Master Retirement Trust and the Crown Cork & Seal Canada
Inc. Pension Fund) and charitable foundations, with respect to which the
Trustees have shared voting and investment power.
Not included in the table above are 7,838,150 shares of Common Stock owned
by The Connelly Foundation, a private, non-profit charitable foundation. Mr.
Avery, Mr. Hilinski, and Mrs. Mandeville are three of 15 Trustees of this
Foundation and disclaim any beneficial ownership of these shares. In addition,
not included in the above table are 72,598 shares of Common Stock held in the
Josephine C. Connelly Trust, of which Mrs. Mandeville is one of the Trustees and
in which shares she disclaims any beneficial ownership. Also not included are
36,942 shares of Common Stock held under the will of John F. Connelly, of which
Mrs. Mandeville and Mr. Hilinski are Trustees and in which shares Mrs.
Mandeville and Mr. Hilinski disclaim any beneficial ownership.
The Company and Compagnie Generale d'Industrie et de Participations
("CGIP") have entered into a Shareholders Agreement (the "Shareholders
Agreement") which provides, among other things, that CGIP is entitled to
designate up to three persons to be nominated for election as Directors of the
Company at each annual meeting of Company Shareholders, depending on the amount
of Company voting securities beneficially owned by CGIP. CGIP has designated
Ernest-Antoine Seilliere, Guy de Wouters and Felix G. Rohatyn as nominees to the
Company's Board of Directors in accordance with this provision. CGIP has also
agreed to vote the shares of Common Stock and Preferred Stock beneficially owned
by it in the manner recommended by the Company's Board of Directors in
connection with the election of directors. A copy of the Shareholders Agreement
was filed with the Company's Current Report on Form 8-K dated February 22, 1996.
Share information in the table above with respect to Mr. Seilliere, Mr. de
Wouters and Mr. Rohatyn does not include the 7,110,300 shares of Preferred Stock
and 27,809,540 shares of Common Stock (which includes shares of Common Stock
which would be received upon conversion of the Preferred Stock into Common
Stock) beneficially owned by CGIP and certain of its affiliates.
CGIP also has a management agreement with CarnaudMetalbox, the Company's
recently acquired subsidiary, pursuant to which CGIP has agreed to provide
management and administrative services to CarnaudMetalbox through 1999. In 1995,
the amount paid by CarnaudMetalbox to CGIP (on a pre-tax basis) under such
agreement was approximately FF 11.2 million (or approximately $2.2 million).
After 1999, the agreement will be automatically renewable unless terminated in
the first quarter of the prior year, in which case such agreement will terminate
on the next succeeding January 1.
(1) Includes 15,725 shares subject to presently exercisable options held by Mr.
Hartman.
(2) Includes 17,625 shares subject to presently exercisable options held by Mr.
Loliger.
6
<PAGE>
BOARD MEETINGS AND COMMITTEES
In 1995, there were five regular meetings and two special meetings of the
Board of Directors and three meetings of the Executive Committee.
In 1995, the Audit Committee had three meetings. The Audit Committee
provides assistance to the Board of Directors in discharging its
responsibilities in connection with the financial accounting practices of the
Company and the internal controls related thereto and represents the Board of
Directors in connection with the services rendered by the Company's independent
accountants. The Executive Compensation Committee met three times and is
responsible for the review of the executive compensation program. There were no
meetings of the Nominating Committee which recommends candidates for election to
the Board of Directors.
The Nominating Committee is responsible for recruiting and recommending for
membership on the Board of Directors candidates to fill vacancies that may
occur. In recommending candidates to the Board of Directors, the Nominating
Committee seeks persons of proven judgment and experience. Shareholders who wish
to suggest qualified candidates may write, via Certified Mail-Return Receipt
Requested, to the Office of the Secretary, Crown Cork & Seal Company, Inc., 9300
Ashton Road, Philadelphia, PA 19136, stating in detail the qualifications of the
persons they recommend. Shareholders must include a letter from each nominee
affirming that he or she will agree to serve as a director of the Company if
elected by Shareholders. However, through its own resources, the Committee
expects to be able to identify an ample number of qualified candidates. See
"Proposals of Shareholders" for information on bringing nominations for the
Board of Directors directly to the Shareholders at the 1997 Annual Meeting.
Each incumbent Director of the Company attended at least 75% of the
aggregate meetings held by the Board of Directors and by the Committees on which
he or she served.
Directors who are not employees of the Company are paid $15,000 annually as
base Director's fees and $750 per meeting attended. In addition, a non-employee
Director who is Chairperson of a Committee is paid $10,000 annually, while
non-employee Director committee members are paid $7,000 annually, with an
attendance fee of $1,000 per meeting. In addition, each non-employee Director
has been granted 3,000 shares of Company Common Stock subject to certain
restrictions. Restrictions on one-fifth of such shares are released each year
over a five-year period. Non-employee Directors also participate in (i) the
Company's Pension Plan for Outside Directors which provides monthly retirement
benefits equal to 1/12 of the sum of (x) 50% of the base annual Director's fees
paid to non-employee Directors and (y) 10% of the base annual Director's fees
for each full year of service in excess of five, up to an annual maximum benefit
of 100% of the base annual Director's fee, and (ii) the Company's Deferred
Compensation Plan for Directors which permits Directors to defer receipt of all,
or any part, of their Director fees, which deferred fees accrue interest at a
rate equal to the current interest rate on the Company's commercial paper.
7
<PAGE>
EXECUTIVE COMPENSATION
The following table sets forth certain information regarding compensation
paid during each of the Company's last three fiscal years to the Company's five
highest paid Executive Officers during 1995:
Summary Compensation Table
<TABLE>
<CAPTION>
Annual Compensation(1) Long Term Compensation
Name & Principal Shares of Common Stock All Other
Position Year Salary Bonus Underlying Options Compensation(2)
($) ($) (#) ($)
<S> <C> <C> <C> <C> <C>
William J. Avery (3) 1995 700,000 206,536 0 4,620
- -Chairman and Chief 1994 668,200 322,400 250,000 4,620
Executive Officer 1993 650,000 323,423 43,400 4,497
Michael J. McKenna 1995 323,084 89,304 0 2,692
- -President and Chief 1994 302,700 107,600 19,500 4,506
Operating Officer 1993 275,000 120,881 16,000 4,125
Mark W. Hartman 1995 280,960 70,280 0 2,458
- -Executive Vice 1994 264,700 85,600 14,000 2,349
President, Office 1993 240,000 86,988 10,500 2,397
of the Chairman
Alan W. Rutherford 1995 272,030 65,636 0 4,080
- -Executive Vice 1994 247,300 79,350 15,500 3,682
President and Chief 1993 225,000 85,298 13,000 3,375
Financial Officer
Hans J. Loliger 1995 267,740 64,424 0 2,835
- -Executive Vice 1994 246,600 74,420 11,500 3,687
President and 1993 205,067 60,000 8,500 2,780
President, Plastics
Division
<FN>
(1) The amount of perquisite and other personal benefits, as determined in
accordance with the rules of the Securities and Exchange Commission
relating to executive compensation, did not exceed the materiality
threshold of the lesser of $50,000 or 10% of the total of annual salary
plus bonus.
(2) The amounts shown in this column represent amounts contributed to the
401(k) Savings and Employees' Stock Ownership Plan (KSOP) by the Company.
(3) As a result of restrictions on the ability of the Company's officers to
sell Company stock during the negotiation and pendency of the
CarnaudMetalbox acquisition, in February 1995 the Company loaned $650,000
to Mr. Avery, and in August 1995 the Company loaned $1,271,875 to Ronald R.
Thoma, Executive Vice President, Procurement and Traffic, and $200,000 to
Craig R.L. Calle, Senior Vice President-Finance and Treasurer. These loans
are secured by the respective Officer's ownership interest in Company stock
and bear interest at the prime rate.
</FN>
</TABLE>
8
<PAGE>
Aggregated Option Exercises in the Last Fiscal Year and
Fiscal Year-End Option Values
<TABLE>
<CAPTION>
Number of Value of
Unexercised Unexercised In-The-
Options Money Options
Number Of Value At 12/31/95 At 12/31/95 (2)
Shares Acquired Realized(1) Exercisable / Exercisable /
Upon Exercise ($) Unexercisable (#) Unexercisable ($)
<S> <C> <C> <C> <C> <C>
William J. Avery 1990 Plan 37,500 962,501 77,125 / 160,175 243,319 / 618,231
1994 Plan 0 0 15,000 / 85,000 63,750 / 361,250
Michael J. McKenna 1990 Plan 37,500 966,017 23,525 / 26,175 66,675 / 77,725
Mark W. Hartman 1990 Plan 37,500 950,782 15,725 / 18,075 44,763 / 54,150
Alan W. Rutherford 1990 Plan 15,000 371,407 21,625 / 22,500 129,188 / 100,531
Hans J. Loliger 1990 Plan 7,500 188,282 17,625 / 23,375 79,719 / 99,844
<FN>
(1) Value Realized is the difference between the price of the stock on the date
exercised less the option exercise price.
(2) Value of Unexercised Options is the difference between the stock price at
December 31, 1995 and the option exercise price.
</FN>
</TABLE>
Option Grants In Last Fiscal Year
The Company's 1990 Stock Option Plan and the 1994 Stock-Based Incentive
Plan are administered by the Executive Compensation Committee appointed by the
Board of Directors. There were no Stock Options granted in the last fiscal year
to the five named Executive Officers.
9
<PAGE>
Retirement Program
The Company maintains its Salaried Pension Plan, which is a qualified
defined benefit retirement plan providing pension benefits for all salaried and
certain non-union employees meeting minimum eligibility requirements. The Plan
provides normal retirement benefits at age 65 based on the average of the five
highest consecutive years of earnings in the last 10 years. These average
earnings are multiplied by 1.25% and by an additional 1.25% if the employee
elects to contribute to the supplemental portion of the Plan. This result is
then multiplied by years of service, which yields the annual pension benefit.
Under federal law for 1996, benefits from a qualified plan are currently limited
to $120,000 per year. Also, for years beginning in 1994, benefits may be based
only on the first $150,000 (adjusted for cost of living increases) of an
employee's annual earnings.
For illustration purposes, the following table shows estimated maximum
aggregate annual retirement benefits payable from the Salaried Pension Plan to
employees who retire at age 65, assuming the employees contribute to the
supplemental portion of the Plan during all the years of service and receive
their benefit as a single life annuity, without survivor benefits:
<TABLE>
<CAPTION>
Final Years of Service
Average
Earnings 15 20 25 30 35
<C> <C> <C> <C> <C> <C>
$ 50,000 $ 18,750 $ 25,000 $ 31,250 $ 37,500 $ 43,750
$100,000 $ 37,500 $ 50,000 $ 62,500 $ 75,000 $ 87,500
$150,000 $ 56,250 $ 75,000 $ 93,750 $112,500 $120,000
$200,000 $ 63,750 $ 85,000 $106,250 $120,000 $120,000
$250,000 $ 71,250 $ 95,000 $118,750 $120,000 $120,000
$300,000 $ 78,750 $105,000 $120,000 $120,000 $120,000
</TABLE>
The Company also maintains the Senior Executive Retirement Plan ("SERP") in
which eight key executives, including the five named Executive Officers,
participate. The fixed annual retirement benefits for three of the named
executives who were first eligible to participate in the SERP before 1993 are as
follows: Mr. Avery - $911,000, Mr. McKenna - $330,000 and Mr. Hartman -
$305,000.
Benefits for executives first eligible to participate in the SERP in 1993,
including Mr. Rutherford and Mr. Loliger, are based upon a formula equal to a
base amount plus (i) 2% of the average of the five highest consecutive years of
earnings times years of service up to twenty years, plus (ii) 1% of such
earnings times years of service over twenty years. Based upon this formula, the
estimated annual benefit at normal retirement for Mr. Rutherford and Mr. Loliger
would be $322,000 and $190,000, respectively.
Years of service credited under the Salaried Pension Plan and the SERP for
the above named individuals are: Mr. Avery - 36 years, Mr. McKenna - 39 years,
Mr. Hartman - 33 years, Mr. Rutherford - 22 years and Mr. Loliger - 3 years.
The SERP also provides a lump sum death benefit of five times the annual
retirement benefit and subsidized survivor benefits.
The SERP participants vest in their benefits at the earliest of five years
of participation, specified retirement dates or employment termination (other
than for cause) after a change in control of the Company. A "change in control"
under the SERP occurs if: 1) a person (other than a Company employee benefit
plan) becomes the beneficial owner of 25% or more of the voting power of the
Company; 2) there is a change in the identity of a majority of directors of the
Company over any two-year period; or 3) the Shareholders approve certain mergers
or consolidations, a sale of substantially all of the Company's assets, or a
complete liquidation of the Company.
10
<PAGE>
EXECUTIVE COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Executive Compensation Committee of the Board of Directors is charged
with developing, monitoring and managing the executive compensation program at
Crown Cork & Seal Company, Inc. We submit this report to Shareholders describing
both the principles under which the program was developed and decisions reached
that directly impact the Chief Executive Officer during 1995.
Principles
Our guiding principle is to implement a unified program that enables the
Company to retain and motivate a team of the industry's most outstanding
executives so that they can create long-term value for the Shareholders. We do
this by:
o regularly commissioning studies of competitive pay practices within
the container industry and other manufacturing companies so that pay
opportunities are generally within competitive norms;
o integrating all executive pay programs with the Company's short and
long-term objectives and strategies; and
o developing ownership-oriented programs that reward for total
Shareholder return over a long-service career.
The Executive Compensation Committee works with independent management
consultants in monitoring the effectiveness of the entire program.
Over the last several years, your Company has undergone dramatic change
and, in the process, Crown has been transformed into one of the world's
packaging giants. To sustain the Company's performance and continue its growth,
we need to not only motivate existing management but to attract and retain
experienced managers at all levels in the Company. As a result, in the last few
years, a number of modifications were made to the four primary components of the
Company's executive compensation program. Overall the program has been
redirected from an orientation on length of service and retirement compensation
to a program more closely aligned with sustained improvement, Company
performance and increased Shareholder value. The specific components of the
program are described below.
1. Base Salary
Historically, the Company's annual base salary levels have been well below
competitive market levels. In order to attract and hold the management team and
also to recognize the substantial growth and performance of the Company, we
continue to move senior executive salaries toward competitive market rates, as
defined by the container and manufacturing industries. Executive salaries were
still below their medians at the end of 1995. The competitive market includes,
but is not limited to, companies of Crown's size in the container, non-durable
manufacturing and general industry segments.
2. Annual Incentives
In 1990, the Committee implemented a goal-based Management Incentive Plan
which replaced programs used in past years. The Plan calls for the achievement
of the Company's net income targets, as well as specific financial and operating
goals, before incentive awards are earned by Plan participants. These goals stem
directly from the Company's strategic and operating plans.
In 1995, the Plan called for the Company to achieve a specified target net
income from normal operations, while at the same time taking into account the
long-term investment needs of the business.
11
<PAGE>
The long-term considerations included, but were not limited to, re-aligning
metal packaging in North America to better serve future market needs, continuing
to develop the overseas operations, especially in the Pacific Rim region, and
developing the Company's plastics activities to meet demand worldwide.
3. Long Term Incentives
Stock options have always been a part of the executive compensation program
of the Company. However, grant opportunities were somewhat discretionary, both
in terms of amount and timing. The Committee has adopted a program that offers
stock options annually, but the size of the grant will vary based on the
Company's and the executive's performance. In making this change, the Committee
reaffirms its belief that stock options are an ideal way to link Shareholder and
executive interests.
4. Retirement Benefits
In the past, the Company's executive compensation plan had a bias toward
providing significant end-of-career retirement income and insurance benefits.
While in no way disavowing the Committee's belief that a long and successful
career with the Company is important to growing Shareholder value, these
programs will begin to decline in importance to the overall program as
competitive pay and incentive opportunities are reached.
In summary, the Committee believes that its role in designing, monitoring
and managing the executive compensation program is critical to the objective of
driving performances to the ultimate benefit of the Shareholders. Base salaries
need to be within competitive norms so that executives will be attracted and
motivated to fulfill their roles and responsibilities over the long-term. Annual
incentive awards deliver the message that competitive pay is received only when
earnings and other tactical goals are achieved. In addition, annual stock option
grants require continuous improvement in value created for the long-term
Shareholder.
Specific Decisions Impacting Compensation for the
Chairman and Chief Executive Officer
In considering the compensation for the named Executive Officers including
the Chairman of the Board and Chief Executive Officer, William J. Avery, for the
fiscal year 1995, the Committee reviewed the goals and objectives established at
the beginning of the year and concluded that the management group continued to
perform in an exceptional manner. Specifically, the following accomplishments
were noted:
1. As a result of recent acquisitions and internal growth, the Company has
been transformed into a major worldwide packaging manufacturer.
2. The acquisitions have been successfully absorbed, efficiency improved and
the organization streamlined, resulting in significant cost reduction and
profit improvement.
3. Although the Company continually restructures operations to meet market
demands, the management decided on a major restructuring in North America
which was announced in September 1994 resulting in the closure of ten
plants, primarily in the metals product area, as well as an additional
restructuring in September 1995.
4. The proposal to acquire CarnaudMetalbox and double the size of the Company
was initiated by Mr. Avery and the acquisition successfully closed in
February 1996, creating the largest packaging company in the world.
12
<PAGE>
Mr. Avery's salary was not changed and currently remains at $700,000. In
addition, a bonus payment of $206,536 was paid in 1995 relating to 1994 results.
Mr. Avery also participates in the Management Incentive Plan as do other
executive and senior management employees. As outlined above, while major goals
under the plan were met, the Company did not meet its budget objective in the
year. The Committee believes that Mr. Avery's strategic vision for the Company,
stewardship and performance during the year has significantly enhanced future
Shareholder value and will dramatically improve the Company's competitive
position.
This report is respectfully submitted by the members of the Executive
Compensation Committee of the Board of Directors.
Harold A. Sorgenti, Chairman
Chester C. Hilinski
13
<PAGE>
COMPARATIVE STOCK PERFORMANCE
Comparison of Five-Year Cumulative Total Return (a)
Crown Cork & Seal, S&P 500 Index, Dow Jones "Containers & Packaging" Index (b)
(The Performance Graph appears here. See the table below for plot points.)
<TABLE>
<CAPTION>
December 31,
1990 1991 1992 1993 1994 1995
<S> <C> <C> <C> <C> <C> <C>
Crown Cork & Seal 100 158 211 221 200 220
S&P 500 Index 100 130 140 155 157 215
Dow Jones "Containers and
Packaging Index" 100 157 172 164 163 176
</TABLE>
(a) Assumes that the value of the investment in Crown Common Stock and each
index was $100 on December 31, 1990 and that all dividends were reinvested.
(b) Industry index is weighted by market capitalization and is comprised of
Crown, Ball, Bemis, Owens-Illinois, Sonoco Products, Stone Container and
Temple-Inland.
14
<PAGE>
SECTION 16 REQUIREMENTS
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
directors, officers and persons who own more than 10% of a registered class of
the Company's equity securities to file initial reports of ownership and reports
of changes in ownership with the Securities & Exchange Commission (the "SEC")
and the New York Stock Exchange. Such persons are required by SEC regulation to
furnish the Company with copies of all Section 16(a) forms they file.
Based solely on the review of the copies of SEC forms received by the
Company with respect to fiscal year 1995, or written representations from
reporting persons, the Company believes that its Directors and Executive
Officers have complied with all applicable filing requirements.
PROPOSALS OF SHAREHOLDERS
In order to be considered for inclusion in the Proxy Statement for the 1997
Annual Meeting of the Company, any Shareholder proposal intended to be presented
at the meeting, in addition to meeting the shareholder eligibility and other
requirements of the SEC rules governing such proposals, must be received in
writing, via Certified Mail - Return Receipt Requested, by the Office of the
Secretary, Crown Cork & Seal Company, Inc., 9300 Ashton Road, Philadelphia,
Pennsylvania 19136 not later than November 25, 1996. In addition, the Company's
By-Laws provide that a Shareholder of record at the time that notice of the
meeting is given and who is entitled to vote at the meeting may bring business
before the meeting or nominate a person for election to the Board of Directors,
if the Shareholder gives timely notice of such business or nomination. To be
timely, and subject to certain exceptions, notice in writing to the Secretary
must be delivered or mailed, via Certified Mail-Return Receipt Requested, and
received at the above address not less than 60 days nor more than 90 days prior
to the first anniversary of the preceding year's annual meeting. The notice must
describe various matters regarding the nominee or proposed business. Any
Shareholder desiring a copy of the Company's By-Laws will be furnished one copy
without charge upon written request to the Secretary.
RELATIONSHIP WITH INDEPENDENT ACCOUNTANTS
The firm of Price Waterhouse LLP is the independent accountant for the most
recently completed fiscal year and has been selected by the Board of Directors
to continue in that capacity for the current year. Price Waterhouse LLP reviews
and performs annual audits of the Company's financial statements and assists the
Company in the preparation of federal tax returns. A representative or
representatives of Price Waterhouse LLP are expected to be present at the Annual
Meeting and will have the opportunity to make a statement if they desire to do
so. Such representatives are also expected to be available to respond to
questions raised orally at the meeting or submitted in writing to the Office of
the Secretary of the Company before the meeting.
OTHER MATTERS
The Board of Directors knows of no other matter which may be presented for
Shareholders' action at the Meeting, but if other matters do properly come
before the Meeting, or if any of the persons named above to serve as Directors
are unable to serve, it is intended that the persons named in the proxy or their
substitutes will vote on such matters and for other nominees in accordance with
their best judgment.
15
<PAGE>
The Company will file its 1995 Annual Report on Form 10-K with the
Securities & Exchange Commission on or before March 30, 1996. A copy of the
Report, including the financial statements and schedules thereto and a list
describing all the exhibits not contained therein, may be obtained without
charge by any Shareholder after March 30, 1996. Requests for copies of the
Report should be sent to: Corporate Treasurer, Crown Cork & Seal Company, Inc.,
9300 Ashton Road, Philadelphia, Pennsylvania 19136.
RICHARD L. KRZYZANOWSKI
Executive Vice President,
Secretary & General Counsel
Philadelphia, Pennsylvania 19136
March 22, 1996
16
<PAGE>
CROWN CORK & SEAL COMPANY, INC.
9300 Ashton Road, Philadelphia, PA 19136
PROXY FOR ANNUAL MEETING OF
SHAREHOLDERS TO BE HELD ON APRIL 25, 1996
The undersigned hereby appoints William J. Avery, Michael J. McKenna and Richard
L. Krzyzanowski as Proxies, each with the power to appoint his substitute, and
hereby authorizes them to represent and to vote, as designated on the reverse
side, all the shares of stock of Crown Cork & Seal Company, Inc. held of record
by the undersigned on March 15, 1996 at the Annual Meeting of Shareholders to be
held on April 25, 1996 or any adjournments thereof, for the items shown below
and in any other matter that may properly come before the meeting:
(1) FOR the election of a Board of fifteen Directors: William J. Avery,
Henry E. Butwel, Charles F. Casey, Francis X. Dalton, Guy de Wouters,
Chester C. Hilinski, Richard L. Krzyzanowski, Josephine C. Mandeville,
Michael J. McKenna, Felix G. Rohatyn, Alan W. Rutherford, J. Douglass
Scott, Ernest-Antoine Seilliere, Robert J. Siebert and Harold A.
Sorgenti.
(change of address/comments)
__________________________________________________
__________________________________________________
__________________________________________________
__________________________________________________
(if you have written in the above space, please
mark the corresponding box on the reverse side.)
You are encouraged to specify your choice by marking the appropriate box (SEE
REVERSE SIDE), but you need not mark any box if you wish to vote in accordance
with the Board of Directors' recommendation. THE PROXIES CANNOT VOTE YOUR SHARES
UNLESS YOU SIGN AND RETURN THIS CARD.
-----------------
SEE REVERSE SIDE
-----------------
- -------------------------------------------------------------------------------
^FOLD AND DETACH HERE^
(LOGO) CROWN CORK & SEAL COMPANY, INC.
Crown welcomes all of our new Shareholders, including the former
Shareholders of CarnaudMetalbox.
We cordially invite you to attend our Annual Meeting in person, but, if you
cannot attend, the Board of Directors requests that you sign the Proxy and
return it, without delay, in the enclosed envelope.
<PAGE>
/X/ Please mark your votes as in this example
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS. This proxy,
when properly executed will be voted in the manner directed herein by the
Shareholder. If no direction is made, this proxy will be voted FOR Election of
Directors.
The Board of Directors recommends a vote FOR the Election of Directors.
FOR WITHHELD
1. Election of Directors. / / / /
(see Reverse Side)
For, except vote withheld from the following nominee(s):
___________________________________
If you receive more than one Annual Report at the address
set forth on the proxy card and have no need for the extra
copy, please check the box at the right. This will not
affect the distribution of dividends or proxy statements. /__/
MARK HERE FOR ADDRESS CHANGE AND NOTE ON REVERSE SIDE /__/
SIGNATURE(S)___________________________________________ DATE _________________
Note: Please sign exactly as name appears hereon. Joint
owners should each sign. When signing as attorney,
executor, administrator, trustee or guardian, please
give full title as such.
- -------------------------------------------------------------------------------
^FOLD AND DETACH HERE^
(LOGO) CROWN CORK & SEAL COMPANY, INC.
IMPORTANT: On March 29, 1996 Crown will pay a cash dividend to Common
Shareholders of record as of March 15, 1996. It is the present intention of
Crown's Board of Directors to continue paying quarterly cash dividends.
It is therefore important that you advise Crown's transfer agent of any
change of address by completing the change of address section on the reverse
side of this Proxy and returning it to First Chicago Trust Company of New York,
without delay, in the enclosed envelope.
